Fringe benefits in Hungary are something you give your employees above their gross salary. They are taxed differently from regular salary, where you as the employer pay social contribution tax on the gross salary, while the employee pay personal income tax and social security contribution. Instead, the employee receives net benefits, while you as the employer pay more taxes. However, the tax content of the fringe benefits is lower than the tax content of regular employment costs.
Fringe benefits usually involve targeted spending, such as spending on transportation, health, or recreation, which make the economy more transparent, while the sectors involved can receive a boost.
At the same time, the targeted nature of fringe benefits sometimes makes it difficult to fully exploit them, which can make employees resent the scheme. Moreover, the tax benefits available through cafeteria elements have been reduced severely over the last few years.