Like most other European countries, Poland has also finally decided to take steps towards mitigating the impact in the rise of electricity prices and inflation.

The set of new measures is currently being processed at Parliamentary level, as well as through Ministry of Finance regulations. These mainly concern lowering indirect taxes in selected impacted industries, as well as direct subsidies for lower-income households. There are also actions taken by the National Bank of Poland to counteract inflation, i.e. raising interest rates.

Some additional measures may be expected due to agreement at the level of ECOFIN for changes in the EU VAT Directive to allow applying 0% VAT on certain food products. Nevertheless, the Polish Minister of Finance recently confirmed that Poland, without waiting for the formal adoption of the directive, is seeking the consent of the European Commission to introduce a zero VAT rate on food for six months.

Below we present a brief overview of the measures discussed and processed aimed at counteracting inflation and high energy prices.

Targeted item Measure Details Period of validity Legislative status as at 13.12.2021
Supply of electricity Decrease of VAT rates
  • For all end-users:
    - 5% (instead of 23%) with respect to domestic supply, ICS and import*
 1.01.2022-31.05.2022 Minister of Finance Regulation – not yet signed
Decrease of excise tax
  • End-users being households
    - exemption (currently approx. EUR 1 /MWh
  • Other end-users:
    - approx.  0.7 cents /MWh instead of  approx. EUR 1 MWh
 1.02.2022 - 31.05.2021 Accepted by the Lower Chamber of Parliament
Fuels Decrease of excise tax
  • Applicable to all buyers:
    - decrease varies however between fuel types (gasoline, diesel, LPG, biocomponents)
  • Higher decrease valid in the period 20.12.2021-31.12.2021
  • Lower decrease valid in the period 1.01.2022-31.05.2022
 Accepted by the Lower Chamber of Parliament
  No taxation with retail sales tax
  • Applicable to selling fuel to consumers
 1.02.2022- 31.05.2022 Accepted by the Lower Chamber of Parliament
Gas and heat Decrease of VAT rates
  • For all end-users:
    - 5% (instead of 23%) with respect to domestic supply, ICS and import*
 1.01.2022-31.03.2022 Minister of Finance Regulation – not yet signed
Inflation Increase of interest rate 8.12.2021 – latest increase of the interest rate by 0.5 bp up to 1.75 bp.

According to economists, further increases are expected in early 2022.

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* The import of electricity and natural gas is permanently exempt from VAT under the provisions of the Value Added Tax Act.