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• The situation of pálinka in Hungary. Problems and opportunities

  75-87

  Imre Milán Harcsa

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  Distillation has centuries-old traditions in Hungary. A brief international outlook will also present the private distillation practices of the surrounding countries. Pálinka is a Hungaricum product produced by exclusively in commercial distilleries. In our country it is possible to make in subcontractdistilleries or at home, however, the product made in this way can only be called distillate and cannot be marketed. Over the last ten years, the legal framework governing the production of pálinka has changed very often, affecting the operators in the sector in different ways. Statistical information on each type of distilling will be presented, with special emphasis on the tax exemption period. Using known data from subcontract distilling, it was found that a HUF 52.1 billion deficit arose from the abolition of excise duty. The 0% excise tax resulted in a boom in subcontract distillation, with a neutral, partly negative effect on commercial distilling. The number of home distillers started to grow extraordinarily, and after the tax was restored, about 50,000 to 70,000 people disappeared from the ranks of subcontractors. Based on secondary sources, I have identified problems in the sector that need to be resolved. Furthermore, I outline the opportunities that are available but are not being used enough.