Sasin's tax will hit almost all people living in Poland

The introduction of the tax on excess profits in Poland will have an impact, in addition to the additional fiscal burden on large companies, also on the wallets of all citizens and other people who lives in Poland, experts note.

Jacek Sasin informed about the plans to introduce a new windfall tax a few days ago on Twitter. “I have sent to Prime Minister Mateusz Morawiecki a solution regarding the taxation of extraordinary profits of state-owned companies and private enterprises.

The estimated budgetary impact is PLN 13.5 billion, which we will spend on mitigating the effects of rising energy prices,” wrote the Deputy Prime Minister. In subsequent interviews, he revealed that he wanted such a tax to be 50 percent from “lead gains”.

The EC wants 33 percent tax

The tax on excess profits was discussed some time ago in the European Commission. The EC proposed 33 percent. A tax on excess profits from the sale of fuels, and proposed to limit electricity revenues to EUR 180 per megawatt hour. So the very idea of ​​Sasin for the tax is not surprising, but its assumptions – yes.

– Until recently, the slogan to introduce a tax on the so-called excess profits would be shocking.

However, taking into account the extraordinary and extremely complicated situation on the market of broadly understood energy resources, more and more numerous and more resounding demands to reach for such solutions, including proposals coming directly from the European Commission, the very idea of ​​implementing such a solution by the Polish government is no longer surprising – notes Grzegorz Szysz, tax advisor, partner in the Kancelaria Prawna team at Grant Thornton.

However, he emphasises that the emerging assumptions of the new tribute are very surprising. – It is not only intended to apply to entities operating in the energy sector, but to every large enterprise. The announced 50% is also shockingly high.

While some extraordinary mechanism could be expected, probably no one outside the circle of insiders assumed such a scope and scale of additional taxation – believes Grzegorz Szysz.

Immediate reaction on the stock exchange

The stock exchange reacted almost immediately to Jacek Sasin’s announcements . The WIG20 index on Monday hit its lowest level since the outbreak of the coronavirus pandemic. it lost 1.7 percent.

State-owned companies also reacted – Jastrzębska Spółka Węglowa and Enea lost almost 10 percent, Bogdanka and Tauron almost 8 percent, PGE and Orlen over 6 percent. There is still no optimism in the stock market.

The mere reaction of the stock exchange is enough to notice that the new government idea will hit not only the portfolios of large companies, but indirectly – all of us. – It is necessary to emphasise the high importance of this tax and its impact on a number of elements.

The announcements themselves had a direct and very significant impact on the quotations of Polish companies, which in turn affects the savings of millions of Poles individually or through, for example, PPK – believes Grzegorz Szysz from Grant Thornton.

Even higher inflation in Poland

However, an impact on Poles’ and expats wallets may come from yet another side. – As we know, according to the assumptions, the tax is to apply to all companies employing over 250 people, i.e. also domestic and international concerns that conduct production, service and trade activities in our country. The new tax will be an additional burden for them – believes Mariusz Durzyński, tax advisor from KPF GROUP.

– In the current market realities, with galloping inflation, many companies make decisions regarding the accumulation of funds to cover not only the costs of necessary investments, but also to cover the growing costs of living, including energy costs, so as to have a financial safety buffer in this regard.

With an additional tax burden on the profit, companies will, in my opinion, try to increase their profit even more, so that after paying the new tax, they will secure the profit at their disposal at the current, planned level. All this will translate into an even greater margin increase, i.e. an increase in the prices paid by citizens, i.e. consumers – he adds.

Investment outflow

Grzegorz Sysz from Grant Thornton mentions one more effect of the government’s decision. – Aggressive fiscal policy, which punishes higher incomes, effectively discourages investing, and the lack of investment has been a problem for the Polish economy for years. It should be mentioned that even today large companies operating in Poland are facing increasingly higher taxation – he says.

It should be emphasised, however, that just investments in specific sectors of the economy would, according to Sasin’s plan, allow the tribute to be reduced.

According to the analysis carried out by Grant Thornton, the effective tax rate on the income of the largest Polish companies has increased since 2014 from a level close to the nominal rate of 19 to approx. 33 percent in the years 2020-21.

– When an overly aggressive fiscal policy is combined with such a large volatility of the law in Poland and global and local turmoil, it is more and more difficult to find optimistic forecasts for the Polish economy, and as a result … the average Kowalski – believes expert Grant Thornton.

Source: BusinessInsider


Please enter your comment!
Please enter your name here