Under Viktor Orbán, Hungary has introduced a raft of nanny state measures for everything but alcohol and it is now a permanent fixture near the top of the Nanny State Index. It has some of Europe’s most intrusive policies on food, tobacco and e-cigarettes, including an extensive system of food and soft drink taxes, a full ban on smoking indoors and a ban on all e-cigarette flavours except tobacco. Hungary tops the table for over-regulation of food and soft drinks, is second for smoking and third for safer nicotine.

Introduced in September 2011, the Public Health Product Tax (commonly known as the ‘chips tax’) gave Hungary the most extensive system of food and soft drink taxation in Europe. Current tax rates include: sweets and ‘other pre-packed product with added sugar’, pre-packaged pasta and ‘delicacies’: 210 Forints (€0.55) per kilogram: sugary drinks: 23 Forints (€0.06) per litre, energy drinks: 390 Forints (€1.02) per litre, jam: 780 Forints (€2.04) per kilogram, salty snacks and seasonings: 390 Forints (€1.02) per kilogram or litre. Artificially sweetened versions of these products are also now taxed, albeit at a lower rate. All this comes on top of a standard VAT rate of 27 per cent. A ban on selling energy drinks to people under 18 seems likely in 2025.

Hungary regulates vaping more harshly than any other EU country. Until March 2020, the tax rate on vape juice was 55 Forints (€0.17) per ml but this was reduced to 20 Forints (€0.06) in an attempt to reduce cross-border shopping during the pandemic. In January 2023, it rose to 33 Forints (€0.083) and there was a further rise to 36 Forints (€0.90) in January 2025. Heated tobacco is taxed at a whopping €309 per kilogram, the highest in the EU after adjusting for affordability.

Tobacco is heavily regulated with a near-total advertising ban, a vending machine ban and, since 2022, plain packaging. There are no exemptions to Hungary’s ban on smoking in bars, restaurants and workplaces, and smoking is even banned in some outdoor areas. Tobacco and e-cigarette retailing is a state monopoly, with licences allegedly handed out to party loyalists and a partial display ban in place. It has been reported that the government plans to turn the alcohol retail business into a similar state monopoly and there is talk of limiting the sale of energy drinks to the same shops.

E-cigarette advertising is banned and vaping is prohibited wherever smoking is prohibited unless the vaping device was prescribed by a doctor (which is most unlikely).

Tax rates on spirits and beer duty are above average after adjusting for incomes. The only good news is that there is no duty on still wine, alcohol can be advertised with few limitations and there is no mandatory closing time for bars.

With thanks to the Hungarian Free Market Foundation