Poland's Finance Ministry proposes amendments to consumption tax law

Sep.26.2024
Poland's Finance Ministry proposes amendments to consumption tax law
Polish Ministry of Finance proposes amendments to consumption tax rates, excluding vaping devices, aiming to generate $9 billion by 2025.

According to Biznes.Interia's report on September 25th, the Polish Ministry of Finance has sent a letter to the Prime Minister's Office stating that the Council of Ministers has approved a draft law to amend the VAT rates and has recommended that the government pass the draft. The proposal does not include provisions for taxing vaping devices.


The letter stated, "The project has been approved by the executive committee of the ministerial meeting and recommended to the ministerial meeting.


According to the latest draft of the tobacco products consumption tax amendment bill, the projected budget revenue for 2025 is expected to be 35 billion Zloty (9 billion USD), compared to the initial estimate of 42 billion Zloty (11 billion USD). This means that public finances will see a decrease of 7 billion Zloty (1.8 billion USD) in revenue.


In this project, misting devices will no longer be taxed and this issue will be addressed by a separate bill. The Ministry of Finance has requested urgent action from the Prime Minister's office to handle the consumption tax bill.


Given the urgency of the matter, we urge the ministerial conference to review the legislation at the earliest opportunity.


In July of this year, Minister of Finance Andrzej Domański stated that the alcohol consumption tax would be increased by 5% according to the plan set by his predecessor, and the tobacco product tax would be significantly raised.


According to the Minister's summer announcement, the consumption tax on traditional cigarettes may be increased by 25% starting in the new year. The consumption tax on e-cigarettes, especially e-liquids used for refilling, is expected to be raised by 75%.


In addition, it was reported by the media in September that the Polish government may consider criticisms from the tobacco industry and split the increase in consumption tax into two stages. The first stage is set to be implemented on January 1, 2024, and the second stage is planned to take effect on May 1, 2025.


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