The Polish Ministry of Finance has withdrawn a proposal to increase the lump-sum tax rate for certain self-employed individuals and service companies, sparing them from a planned tax hike. The draft law had envisioned raising the rate from 8.5 percent to 15 percent for entrepreneurs who do not employ at least one full-time worker.
The change was set to apply to revenues exceeding PLN 100,000 per year. The ministry argued the measure was meant to prevent situations where the lump-sum tax becomes a way to benefit from a lower tax burden while relying solely on the entrepreneur’s own work.
However, the proposal sparked strong opposition from business organizations and the Ombudsman for Small and Medium Enterprises (SMEs), Agnieszka Majewska. She sent a letter to Finance Minister Andrzej Domański, urging a complete withdrawal of the plan.
The proposed changes and their critics
Under the original draft, the higher 15 percent rate would have applied to specified service activities if the entrepreneur did not employ at least one worker on a full-time employment contract throughout the entire tax year. The lower 8.5 percent rate would have remained only for those with revenues below PLN 100,000.
Majewska argued that the proposal failed to reflect the realities of running a small business. In many micro-enterprises, a single person performs all the work, and there is simply no need to hire employees. She also pointed out that even events beyond the entrepreneur’s control, such as an employee quitting, falling ill, or terminating a contract, could trigger the higher rate retroactively from the start of the year.
– The proposed regulations raise serious concerns and doubts among entrepreneurs and business organizations, as they are disproportionate and do not take into account the actual conditions of running a business – said Agnieszka Majewska, the SME Ombudsman.
Intervention leads to withdrawal
Majewska also criticized the PLN 100,000 revenue threshold, calling it too low and out of step with rising service prices. She warned that the new rules could push taxpayers to abandon the lump-sum system altogether, contradicting the government’s own efforts to simplify the tax system.
– The proposed changes may encourage taxpayers to give up lump-sum taxation, which contradicts the actions taken to simplify the tax system – she added.
Following the ombudsman’s intervention and public consultations, the Ministry of Finance removed the provisions concerning the lump-sum tax from the draft amendment to the PIT, CIT, and certain other acts. The latest version of the document no longer includes any clauses raising the tax rate for entrepreneurs without employees. As a result, the existing rules for calculating lump-sum tax remain unchanged.
Źródło: WNP.PL, Fot. RomanR/Biuro Rzecznika MŚP
