AmCham on the „Polski Ład”

On May 15, 2021, the government presented a new socio-economic program called „Polski Ład” to introduce many changes to the tax system, health care system, housing, and support investments, including the social area. The „Polski Ład” announced many positive changes, which AmCham has been signaling for a long time, e.g., IPO; relief for automation and robotization of production; a combination of IP Box and R&D relief; or health insurance contribution for the self-employed proportional to income.

The estimated cost of implementing the program is approximately PLN 651.6 billion. The program’s implementation is to be spread until 2030. However, many regulations will be introduced in the upcoming months and at the beginning of 2022.

The most critical reforms include, e.g.:

• 7% of Poland’s GDP to be allocated to healthcare;
• Increase the tax-free amount to PLN 30,000 PLN and the 2nd tax threshold from 85,528 PLN up to 120,000 PLN;
• An extension to the Estonian CIT and relief for IPOs who enter the stock exchange; tax-deductible costs of employed scientists; the possibility of simultaneous use of IP-BOX and R&D discounts; an introduction of a consolidation relief; relief for automation and robotization of production;
• Interpretations 590, i.e., the certainty of taxation in the first years of the investment;
• Establishment of the Investor Tax Service Center at the Ministry of Finance, responsible for contacts with strategic investors;
• Simplification in settlement of transfer prices for holdings investing in Poland;
• Settlements within capital groups without VAT;
• Statutory regulation of employee shareholding;
• Supporting the expansion of companies abroad;
• Development of infrastructure, roads, and highways, over a hundred bridges and ring roads, development of transport and logistics, and the modernization of railways;
• Retrofitting hospitals and the creation of new specialist laboratories, construction of nurseries, kindergartens, and sports infrastructure,
• Digitization and ensuring 5g networks are available in all urban areas;
• Regulatory changes in agriculture and the introduction of a new agricultural code;
• The possibility of building single-family buildings with an area of ​​up to 70 m2 without a permit; the state guarantees its contribution to the loan for the purchase of an apartment.

The „Polski Ład” also announces changes that may be disturbing for American companies employing mainly on an employment contract and offering a competitive salary on the market. An example would be the lack of the possibility of deducting health insurance contributions from taxes, which means that people earning more than PLN 10,000 gross on a contract of employment will have a lower net amount, and for companies employing such staff, a more significant burden.

AmCham Poland is continually active in the legislative process and the legal environment in Poland. Bearing in mind the importance and tremendous scope of the planned reforms, we intend to actively participate in the dialogue with the public party and monitor legislative processes to develop the best possible solutions for conducting business in Poland through the expert voice of our member companies.

If you have any comments or remarks on the “Polski Ład” please contact us at the following e-mail address: [email protected]