So-called “Estonian tax” to be introduced in Poland as of 2021
The Polish Ministry of Finance has announced the planned introduction of the so-called “Estonian tax”.
According to the announcement, companies will be allowed to choose one of two solutions. The first is a model that allows for taxation of only redistributed profits. The second is based on setting up a separate investment account (fund) that would allow deductions from corporate income tax.
Conditions of entry into the system may however make it less attractive and very narrow-targeted as the system will be dedicated for companies with revenues below PLN 50 m, hiring at least three employees, whose shares are held only by natural persons, and who do not possess shares in other entities. Moreover, passive income cannot be greater than operational income, and increase in investment spending should be at least 15% within two consecutive years.
It seems that such framework for the new system is strictly related to the Ministry of Finance’s approach to limit the possibilities of taking advantage of the new law for tax planning purposes. Also, it seems relevant to ask about the potential value of investment spending during the COVID-19 period.
The new tax is likely to be introduced as of 2021, and the draft bill has not yet been presented (it may be revealed mid-July) – thus its assumptions may still change.