The European Commission has launched an investigation into Hungary’s progressive advertising tax.

BBJ reports that the Commission has expressed concerns the tax “could favour certain companies and give them an unfair competitive advantage”.

The tax is based on turnover rather than profits and the Commission says that the Hungarian authorities have until now offered no reasons for its justification.

Separately, the Commission has forbidden Hungary from applying the progressive rates until its assessment is finished.

The tax caused a major rift between the government and RTL, the operator of Hungary’s leading broadcaster.

However, there have recently been signs that differences between them are gradually being resolved.