Promised for 2 years, held for fourteen years – this is the past of increased VAT in Poland. Despite the conditions for returning to lower rates, the Sejm again rejected the Citizens' petition of the Good State Foundation, which demanded a return to the level before 2011. The Government and the Committee on Petitions are unanimous: under the current circumstances, financial stableness and State safety are a priority.
14 years of ‘temporary’ VAT. What is it about petitions?
Good State Foundation asked the Sejm to return VAT rates of 22% (base rate) and 7% (reduced bet)which were in force before 2011. That's it. third sample civilian intervention on this matter. The petitioners recalled that the increased rates would only apply for 2 yearsas a temporary consequence to the financial crisis.
However, as the initiators emphasize, it has since passed 14 yearsand higher rates became a standard, even though Poland – according to the Foundation – present meets the economical conditions for returning to the erstwhile level of taxation of consumption.
Inflexible parliament: war and budget more crucial than VAT reduction
Parliamentary Committee on Petitions no doubt: maintaining the current VAT rates is comply with European Union law and – more importantly – necessary to keep the stableness of the state budget. In the opinion put forward by the Commission, a return to lower VAT would be irresponsible in the current geopolitical and financial situation.
Among the most crucial arguments are:
- the request for further financing of defence expenditure in connection with the war in Ukraine,
- service rising public debtof which Union loans,
- maintenance of key social and investment programmes.
The authorities besides trust on practices of another countries. For example:
Hungary keep VAT base rate of 27%, a Denmark and Croatia – 25%. Compared to them, Polish 23% It does not look so bad – the government representatives convince.
‘Gold at the State’ – how VAT shapes the budget
VAT remains 1 of the key sources of gross for the state budget. In 2023 he brought over 270 billion PLNWhat was around 45% of all taxation revenues. Any simplification in the VAT rate, even by 1 percent point, would mean a simplification in the order of the budget Several billion zlotys a year.
Therefore, as the Commission stressed, such fundamental taxation changes cannot be implemented on the basis of a citizen's petitionbut they must be the consequence A broad legislative process, taking into account the social and financial implications.
What's next? Poles pay – and they will pay
The decision of the Sejm means that the basic VAT rate will proceed to be 23%, a reduced rate – 8%. Petition of the Good State Foundation has been officially found unfoundedand the chances of its implementation in the foreseeable future are practically zero.
As he comments Dr Marek Zuber, economist, as quoted by News editorNade Today:
"The simplification in VAT always sounds attractive to consumers, but in practice it means immense gains in state income. As long as we face a tense global situation and major investment needs, politicians will not take this step."
A Future Perspective
Although VAT may return to electoral campaigns or on the occasion of thorough taxation reforms, there is presently no indication of the government's willingness to quit billions of dollars. VAT was to be a ‘provisionally increased’ taxation – present it is a pillar of the public finances system.
Poles can number on symbolic changes in the future – or relief for selected sectors – but not on the systemic simplification requested by the Foundation.
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They promised lower VAT, but the Sejm refused again. Poles pay more – without end?
