The Ministry of Finance is proposing a package of tax reliefs aimed at reviving the economy.
The Ministry proposes to introduce:
- relief for the initial public offering of shares (IPO relief);
- relief for investors via Venture Capital funds that invest capital in innovative enterprises;
- consolidation relief;
- expansion relief;
- changes in the so-called “Estonian” CIT.
In addition, the Ministry proposes to introduce into Polish regulations in the field of the so-called VAT groups.
IPO relief
According to the announcement, the IPO relief is to allow for the settlement for tax purposes of 150% of expenses directly related to entering the stock exchange (preparation of the prospectus, notary, court, fiscal and stock exchange fees as well as for the preparation and publication of advertisements required by law) and the deduction of an additional 50% of expenses for advisory services , legal and financial matters directly related to the issue (up to PLN 50,000 net).
The package will also include a tax relief for individual investors, consisting in the waiver of the obligation to pay PIT on the income from the sale of shares purchased under the IPO, provided that they are retained for a period of 3 years.
Venture Capital relief
The Ministry proposes that those who invest in start-ups through Venture Capita funds should be able to settle some of the invested funds for tax purposes. Details are not known yet, however, according to the available materials, the deduction would concern up to 50% of the investment amount, not more than PLN 250,000.
Consolidation relief
The purpose of the relief is to grant an additional deduction in the event of a takeover of the entity for its restructuring. As in the case of R&D relief, expenses for eligible costs will be deducted – here expenses incurred directly for the acquisition of shares in a capital company (for legal services, appraisal, preparation of merger plans, audit, taxes, etc.).
Relief for expansion
The purpose of the expansion relief is to deduct from income expenses incurred to increase sales of products (participation in fairs, promotional activities, preparation of the necessary documentation). Thus, the expenses will be deductible on general principles and as a relief – proposal up to the amount of PLN 1 million.
Changes to the “Estonian” CIT
The proposed changes to the “Estonian” CIT are to simplify and make this solution more attractive and include:
- elimination of the revenue limit (currently PLN 100 million);
- the right to make settlements for limited partnerships, limited joint-stock partnerships and cooperatives;
- abolishing the minimum investment volume requirement;
- effective rate for small taxpayers 20%
- possible lack of tax when resigning from the flat rate.
VAT group
The Ministry announced that it was starting work on introducing the so-called VAT groups.
Based on EU regulations, it is possible to introduce rules according to which entities related to each other (financially, economically and organizationally) are considered to be a single VAT payer.
The most important consequence of being a member of such a group is the lack of taxation of intra-group activities. This means less administrative burdens and better management of VAT liquidity, e.g. for entities that do not deduct the full tax, or when some entities have surpluses and others have tax liabilities.
The formation of groups is to be voluntary. It is planned that, in the first place, the VAT Group may be created by entities belonging to a tax capital group.
No further details are known yet, especially the planned date of entry into force of these changes.
