Economy
Poland deploys Hungary's "wonder weapon"
Poland’s Prime Minister Mateusz Morawiecki has announced an ambitious fiscal package, the details of which have been revealed by Marek Suski, head of the PM’s political cabinet.
He said the cost of the plans has not been calculated "to the zloty", but noted that government efforts to clamp down on VAT tax fraud and evasion had secured about PLN 40 billion (EUR 9.6 bn) over a year.
"We've been carrying out all the social and business initiatives thanks to plugging loopholes in the VAT (collection) system and economic growth. Early last year we reduced CIT to 15% from 19%," the PM told a political convention of the ruling Law and Justice party and the United Right camp in Warsaw on Saturday.
Cutting the CIT rate lower to 9% would result in the lowest CIT rate in the EU, and Poland would compete in this regard only with Hungary where the rate is 9% for all companies, not just for SMEs. In fact, the rate is the lowest in the world, except for notorious safe havens, such as Bermuda, the British Virgin Islands and the Cayman Islands where the CIT rate is 0%.
Before introducing a flat 9% CIT rate, Hungary firs tcharged a 10% rate on small businesses—covering corporate income up to HUF 500 million — and 19% on anything above that.
Small companies are also set to benefit from lower social security (ZUS) contributions, according to Morawiecki, who said this would help to pull some companies out of the grey economy.
The Prime Minister also announced further projects addressed to senior citizens and the disabled under the government's "Accessibility Plus" programme and went on to say that "over the next few years" the government would provide PLN 23 bln (EUR 5.5 bln) for the scheme.
He also said his government would inject some PLN 5 billion (EUR 1.2 bn) into efforts to renovate and build roads in local areas and would help finance the purchase of school supplies for children -- by offering parents a handout of PLN 300 for every child under the age of 18 before the start of each school year.
He said the cost of the plans has not been calculated "to the zloty", but noted that government efforts to clamp down on VAT tax fraud and evasion had secured about PLN 40 billion (EUR 9.6 bn) over a year.
"We've been carrying out all the social and business initiatives thanks to plugging loopholes in the VAT (collection) system and economic growth. Early last year we reduced CIT to 15% from 19%," the PM told a political convention of the ruling Law and Justice party and the United Right camp in Warsaw on Saturday.
Cutting the CIT rate lower to 9% would result in the lowest CIT rate in the EU, and Poland would compete in this regard only with Hungary where the rate is 9% for all companies, not just for SMEs. In fact, the rate is the lowest in the world, except for notorious safe havens, such as Bermuda, the British Virgin Islands and the Cayman Islands where the CIT rate is 0%.
Before introducing a flat 9% CIT rate, Hungary firs tcharged a 10% rate on small businesses—covering corporate income up to HUF 500 million — and 19% on anything above that.
Small companies are also set to benefit from lower social security (ZUS) contributions, according to Morawiecki, who said this would help to pull some companies out of the grey economy.
The Prime Minister also announced further projects addressed to senior citizens and the disabled under the government's "Accessibility Plus" programme and went on to say that "over the next few years" the government would provide PLN 23 bln (EUR 5.5 bln) for the scheme.
He also said his government would inject some PLN 5 billion (EUR 1.2 bn) into efforts to renovate and build roads in local areas and would help finance the purchase of school supplies for children -- by offering parents a handout of PLN 300 for every child under the age of 18 before the start of each school year.
