Humanitarian Aid and Customs Regulations: A Hungarian Case Study

Barbara Kertai

Approximately 150,000 foreign and international organizations are currently registered in Hungary. Any Christian organizations desiring tax-exempt status and authorization to distribute humanitarian aid in Hungary must register with the Ministry of Public Welfare by submitting the group's founding document and any valid contracts with local companies or agencies. Any Christian organizations desiring tax-exempt status and authorization to distribute humanitarian aid in Hungary must register with the Hungarian Ministry of Public Welfare. A registered humanitarian organization, with a tax number entitling it to certain exemptions, can import humanitarian aid under certain conditions. Generally, every item must clear customs, and duty and value-added tax (VAT) must be paid, which may be partially or completely reclaimed afterwards. Such a claim must be filed separately in each case.

The following goods/conditions allow for duty exemption in Hungary:

• Those items which are to be used or distributed free of charge by registered charities or humanitarian organizations in Hungary and are received free of charge. Exception: vehicles, including ambulances [#0361/111/2].
• Medicine, food, and clothing that arrive free of charge to registered churches and denominations [#0361/111/4].
• Food, medicine, clothing, and other essential items intended for free distribution to victims of natural disasters such as fires and floods [#0361/111/5].
• Religious objects donated to registered churches and denominations and material assistance given to construct or renovate churches and prayer houses [#0361/111/6].
• Medical items and equipment given to state or church-run hospitals, under the condition that they not be sold or rented within three years [#0361/111/8].
• Gifts given by foreign states and international organizations which have a public/ national purpose, especially educational, environmental, social, or medical [#0361/117/1].
• Educational and scientific objects donated to institutes of higher education, science, or health care, as well as to educational, scientific, and medical foundations [#0361/117/3].
• Donated books, periodicals, and printed music [#0361/118/1].
• Items received free of charge serving the public good in areas of education, health care, culture, religion, and ethnic minorities are eligible for exemption or discount [#0370/138/2].

Sending Humanitarian Aid to Eastern Europe:
Guidelines for Clearing Customs

Barbara Kertai

• Complete a thorough investigation of a country's needs. Gifts must make common sense: for example, do not donate videotapes if VCRs are scarce.

• Become familiar with each nation's trade and customs regulations. Generally speaking, donations are duty-free if they offer educational, social, or cultural aid, or help for health care or ethnic minorities. Websites on international trade laws and regulations include: The Commonwealth Yearbook (http://www.tcol.co.uk/cyb.htm); International Trade Law Monitor (http://itl.irv.uit.no/); International Chamber of Commerce (http://www.iccwbo.org/).

• The process is simplest when donations are made to a specific institution or organization, such as a single orphanage, hospital, or local humanitarian organization. In this case, all customs procedures (making an official list of the goods, filing for exemption, reclaiming VAT, etc.) are the responsibility of the recipient, thus minimizing donor responsibilities.

• If the donor organization is planning to distribute or use the nonprofit goods itself, procedures vary from country to country. In most cases, the organization must get official recognition as a charitable or humanitarian organization in country, which means having a valid contract, local representation, and a tax number. Be aware that bureaucracy in East Central Europe is complex and inefficient. Laws change rapidly, making procedures unclear and subjective and giving opportunity for corruption.

• For a description of customs regulations and duty-exempt items and categories, contact national consulates. See East-West Church & Ministry Report 6 (Summer 1998), 13-14; http://www.tagish.co.uk/embassy1a/ (worldwide); and http://www.embassy.org/embassies/index.html (U.S.).

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© 1998 East-West Church and Ministry Report
ISSN 1069-5664