Art, collections and vehicles in the wealth-tax proposal – based on the draft

Personal use would not provide an unlimited exception

Section 6(3) would generally exclude an individual's personal-use belongings and furnishings or equipment ordinarily needed for a property's proper use. Specified values of art, collections, jewellery and vehicles would override that exclusion. Personal use alone would therefore not decide whether an item remained outside the wealth-tax calculation: its classification and individual value would also matter.

The override would cover art, collections and jewellery individually exceeding HUF 3 million, and vehicles individually exceeding HUF 10 million. Section 6(3) would require exceeding, rather than merely reaching, the threshold. These would not be deductible allowances: the provision would not include only the excess value. Its personal-use exclusion would concern individuals, rather than all movables belonging to every taxpayer.

Collections as units and the relevant definitions

Under point 13 of Section 2, a collection would consist of items assembled through collecting that formed a unit by a common criterion and were worth more together than their individual combined values. The criterion could concern character, rarity, origin or purpose. Section 20(1) would accordingly require collective rather than item-by-item valuation, which would also matter for the Section 6 threshold.

For art, point 29 of Section 2 would refer to Annex 8 of the VAT Act; the draft would not reproduce those external categories in detail. Point 17 would exclude money, securities and investment precious metals from movables. Not every physically movable asset would therefore fall under Section 20. The draft's own jewellery and vehicle definitions in Section 2 would likewise establish the relevant boundaries.

Business connections: full value without double counting

Section 6(4) would override personal-use treatment if an individual used an item wholly or partly for sole-trader or agricultural primary-producer activities. The same would apply if the item related to that activity or expenses were claimed for it. Its full value would then count; partial private use would not automatically split value proportionately into private and business components under this subsection.

Section 13 would nevertheless affect valuation. A sole trader taxed on entrepreneurial income would value related assets through Section 12(3) and Annex 1 as adapted. Section 13(3) would prevent assets and debts already included from being counted again under another heading. For other sole traders and primary producers, subsection (4) would require asset-by-asset valuation, without a separate earnings value derived from their activity income.

Priority for a recent acquisition price

Unless another rule applied, Section 20(1) would use ordinary market value on the reference year's final day. Under subsection (2)(a), the first basis would be consideration paid on acquisition between independent persons within the preceding twelve months. This would not automatically carry forward every historical purchase price: both recency and independence would be required.

There would also need to have been no materially value-affecting change between acquisition and valuation. Otherwise, comparison under Section 20(2)(b) would become relevant. Historical consideration would therefore represent current market value only under qualifying circumstances. Acquisition timing and subsequent changes would not be incidental background information but conditions governing availability of the method.

Comparable prices and vehicle-specific characteristics

Section 20(2)(b) would use temporally close sale prices, public-auction prices or publicly accessible commercial asking prices for identical or materially comparable items. Differences would require adjustment; a published price would not unconditionally become the subject item's value. Subsection (4) would require retrospectively verifiable identification and comparison data, condition, price, date and source.

For motor vehicles, Section 20(6) would emphasise make, model, version, first registration, mileage, technical condition and equipment. For watercraft, manufacturer, type, year, size, propulsion, use, condition and equipment would matter alongside major renovation or alteration dates. Aircraft comparison would consider manufacturer, type and year, flying hours and cycles, engine condition and operating time, maintenance condition, equipment and configuration.

Insurance value and an optional expert

If neither a qualifying acquisition price nor comparable data established value, Section 20(2)(c) would turn to insurance value reflecting market value. Subsection (5), however, would reject reacquisition value or replacement cost for a new item as sufficient by itself. The insured amount would need substantively to represent market value at the relevant valuation date.

Section 20(3) would alternatively permit a suitably knowledgeable independent expert instead of the entire preceding hierarchy. The report would reflect year-end condition and market circumstances knowable then. A report no more than twelve months old could remain usable without material value-affecting changes. This would be optional, not a universal appraisal obligation, so the compulsory-service fee reduction in Section 9(2)(a) would not follow automatically.

From item valuation to the overall tax base

The movable-property thresholds in Section 6 would determine which items counted, not replace calculation of the overall tax base. For residents, only aggregate value above HUF 1 billion after qualifying documented debts would constitute that base. For non-residents, Section 4(2) would not generally include movables. Establishing an item's value would therefore not by itself demonstrate tax payable.

Section 9(2)(b) would reduce tax by qualifying vehicle tax, or corresponding similar foreign tax, due and paid in the relevant tax year for an included asset, excluding refundable amounts. Section 25(7)–(8) would require disclosure of the valuation method and material data and retention of supporting records. For market comparisons, this would connect directly with Section 20's requirement for retrospective verification.

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