Polish Deal is coming

by Monika Spotowska

5 October 2021

The lower chamber of Polish parliament (Sejm) passed the amended tax bill dubbed "Polish Deal" on 1 October 2021. The bill will now go the Senate for further processing. According to plan, the Polish Deal is supposed to come into force from the beginning of 2022, which means that is must be adopted and promulgated by the end of November.

The bill adopted by Sejm has been amended compared to the original proposal. Among other things, the effective date of the tax on private lease and depreciation of residential real properties will be deferred. The unfavourable changes will not come into force until 2023. The provisions on hidden dividend will also be deferred by a year. The bill modifies the rules on minimum tax and tax abolition. There are also some new solutions friendly to seniors and 4+ families.

Here is the reminder about the key aspects of the Polish Deal:

• personal tax exemption amount increased to 30 thousand zloty;
• tax threshold increased from 85 thousand zloty to 120 thousand zloty;
• tax-free pensions up to 2.5 thousand zloty;
• flat tax rates reduced for e.g. engineers, IT specialists, physicians;
• changes to health insurance contributions;
• changes to incentives for enterprises.

These are just some of the tax novelties proposed in the bill. Due to their wide-stretching coverage, we recommend a tailored analysis of the Polish Deal's implications for your company.