By Dr. Monika Laskowska, Middle of Tax Analyses and Research, Warsaw College of Economics
Poland’s Minister of Finance on four September proposed company taxation legislative modifications, together with a proposal that will require giant companies to publish their tax insurance policies and tax methods.
The brand new obligation would apply to the 2700 largest companies (.5% of all company taxpayers) and can be modeled after UK legislation.
Poland company tax disclosure
From 2018, Poland’s Ministry of Finance has publicized on its web site company tax knowledge. The info covers the biggest taxpayers – these with income exceeding EUR 50 million from 2012. This listing is yearly up to date each 30 September.
The publication of the info generated widespread public debate and media commentary. Some commentators argued that because the publicly obtainable knowledge covers solely company revenue tax – not private revenue tax or excise tax – it doesn’t correctly seize the complete contribution of those giant companies make to the Polish price range. Sturdy arguments had been raised in regards to the range of firms’ methods and their long-term obligations and contributions to the wealth of the Polish nation.
The brand new proposal needs to be seen partially as a response to those arguments. The Ministry of Finance highlighted that introduction of the brand new obligation ought to strengthen society’s management over huge firms in addition to present knowledge for scientific analysis. Poland’s Ministry of Finance mentioned that new legislation ought to permit firms to clarify why taxes paid in Poland are in keeping with their financial exercise in Poland.
Based on the Ministry of Finance, by growing tax transparency, firms could have a chance to clarify the influence of their investments in Poland on their tax return.
Constructing the wealth of the internet hosting nation needs to be seen as a component of the enterprise’s social accountability and may strengthen the firms’ manufacturers domestically.
Whereas some companies already voluntarily publicize their tax coverage, the federal government’s objective is to broaden transparency to all giant taxpayers in Poland.
It’s not but clear what precisely needs to be lined in such a tax coverage and to what extent components of a multinational’s world tax technique needs to be addressed within the Polish disclosures.
Transfer pricing, withholding tax proposals
The brand new tax legislative package deal is the continuation of Poland’s anti-avoidance package deal.
The Ministry introduced that the package deal would additionally embrace some modifications to the tax instruments for countering the shifting earnings to tax havens by means of switch pricing.
Additional, the Ministry of Finance introduced the continuation of a public session on modifications to Poland’s withholding tax laws.
The withholding tax amendments would modify the definition of a helpful proprietor, limit withholding tax refunds for passive revenue amongst related firms, and make clear the due diligence necessities for verifying refund recipients.