Tax developments and trends worth observing in Poland in 2021
Although most of the changes for 2021 have already been adopted, the MF is very active and has already revealed certain areas which may be subject to new regulations. These areas were specifically addressed in the set of documents included in the “Green Paper – Tax Restart Strategy for Poland”.
Among the most interesting it is worth mentioning the new holding regime providing for reliefs, such as capital gains exemption on disposal of qualified shares in subsidiaries, or changes aimed at relaxing formalities on use of Tax Consolidated Groups. Moreover, it is envisaged that a Tax Consolidated Group could consolidate its results also for VAT purposes VAT-wise. The MF also discusses introducing an optional / voluntary VAT taxation of financial transactions, which – under current assumptions – is about to be based on the “German model”, i.e. the option would be available only for financial services provided exclusively to taxpayers.
Further developments concern the introduction of a new tool (called under working title a 590 Tax Ruling) which would aim at providing “strategic investors” with more individualized, better targeted clarifications of tax consequences of their potential investments.
The “Restart Strategy” also mentions certain incentive tools aimed at improving investments in innovative business or solutions, such as supporting employers in hiring innovative employees, tax reliefs for robotics and automation solutions, and tax reliefs for prototypes.
Some new developments can also be expected with respect to e-commerce, as the MF has recently revealed a draft “E-commerce” package implementing EU Directive in this respect. The law is to become effective as of 1 July 2021.
From the international tax perspective, Poland has recently been quite active in the process of renegotiations of double tax treaties despite the fact if they are “Covered Tax Agreements” in the meaning of the MLI. Recently Poland has signed a protocol to the DTT with the Netherlands and Malta. With respect to the latter, the MF specifically pointed that the MLI did not cover all of the issues necessary to prevent the BEPS effect. Thus, it may be expected that also some of other DTT’s will go through a similar “screening” process and we may see further renegotiations as well.
Last but not least, Poland also participates in the OCED’s working groups on Pillar 1 and Pillar 2; thus it will be worth to carefully analyze any developments or new law in this area.