The measure is part of a campaign against US financier George Soros, who is accused of plotting to undermine the country's Christian culture by flooding it with immigrants by funding liberal causes.
Hungary's government will submit a new version of its "Stop Soros" bill to parliament on Tuesday, imposing criminal penalties on groups accused of supporting or financing illegal immigration, a senior government politician said.
The legislation is part of right-wing Prime Minister Viktor Orban government's campaign against George Soros, a Hungarian-born US financier known for funding liberal causes.
Csaba Domotor, state secretary, told a news conference that the text of the new legislation will be made public later on Tuesday and the government wanted parliament to pass the law as soon as possible.
In power since 2010, Orban has increased his control over the media and has campaigned on a platform of fierce hostility to immigration for years – policies that have put him at odds with the European Union, which funds Hungary with billions of euros a year.
Soros has been vilified in Orban's campaign for April elections, which Orban won in a landslide, securing a third-straight term in office. The anti-immigration stance was popular with voters in rural Hungary.
He has accused Soros and the NGOs funded by him of a plot to undermine Hungary's Christian culture by flooding it with immigrants, an allegation which Soros has repeatedly denied.
"This is a legal framework and it will be up to the courts to decide how they will qualify certain activities," Domotor said.
Orban risks triggering a crisis in his Fidesz party's relationship with the EU's centre-right parties over laws they charge infringe civil liberties, an ally of Germany' chancellor warned on Monday.