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Welcome to the next issue of the “Weekly Tax Review” prepared in cooperation with tax experts in KPMG in Poland.

On 12 December 2023, the Constitutional Tribunal rendered judgment, according to which Article 15zzr1(1) of the Act of 2 March 2020 on specific solutions related to preventing, counteracting and combating COVID-19, other infectious diseases and the resulting crisis situations (Journal of Laws of 2023, item 1327, as amended) relating to the stay of the statute of limitations for punishable offenses and execution of sentences in criminal and criminal fiscal cases is in breach of Article 2 of the Constitution of the Republic of Poland. The Constitutional Tribunal explained that the legislator did not indicate the date by which the stay of the statute of limitations for punishable offenses and the statute of limitations for the execution of sentences in criminal and criminal fiscal cases were to apply, nor did it specify their maximum duration. Consequently, this led to the establishment of institution of indefinite statute of limitations, affecting the principle of protecting trust in the state and law.

The judgment of the Tribunal repeals the contested provision. This opens a pathway for the interested entities to resume the proceedings, while the repealed provision is to be omitted in sentences and the general provisions on statute of limitations are to apply instead.

On 12 December 2023, the Constitutional Tribunal rendered judgment (ref. no. SK 110/20), according to which provisions on suspending the statute of limitations for tax liability from date of filing a complaint to the Administrative Court, until date of delivery to the tax authority of a copy of the administrative court's judgment declaring it is final and non-appealable (Article 70(6)(2) and Article 70(7) of the Tax Code) are in line with Polish Constitution.

On 15 December, the President signed the Act of 12 December 2023 amending the Act on electronic deliveries into law. The Act provides, inter alia, for amending Article 155(11) of the Act on electronic deliveries, so that the date of entry into force of provisions on mandatory e-deliveries specified in the notice by the Minister of Digital Affairs falls no earlier than on 30 March 2024 and no later than on 01 January 2025.

On 09 December 2023, the regulation of the Minister of Finance of 09 December 2023 on reduced VAT rates in 2023 was published in the Polish Journal of Laws.

The regulation extends the application of reduced VAT rates, i.e.:

  • 0% – for selected medicinal products and – until 31 March 2024 – for basic food products
  • 8% – for selected products used in agricultural production in 2024.

The regulation enters into force on 01 January 2024.

On 8 December 2023, the Council of Ministers published a regulation amending the regulation on granting real estate tax and transportation tax exemptions, which are treated as regional investment aid, aid for culture and heritage conservation, aid for sport and multifunctional recreational infrastructure, aid for local infrastructures, aid for regional airports or aid for maritime ports. The regulation relates to the nationwide aid program and conditions for granting aid in the form of local tax exemptions in line with Commission Regulation (EU) No 651/2014 of 17 June 2014 declaring certain categories of aid compatible with the internal market in application of Articles 107 and 108 of the Treaty (GBER).

Aid to subsidized projects covered by the regulation will be granted for three more years than it is currently possible. This is because the GBER itself was prolonged until the end of 2026. The regulation enters into force on 31 December 2023, it is currently included in the list of acts awaiting promulgation, with the latest date of its announcement scheduled for 22 December 2023.

On 13 December 2023, the Supreme Administrative Court delivered judgment (case file III FSK 1070/23) with the conclusion that in order to apply to residential buildings or parts thereof the maximum tax rate provided for by Article 5(1)(2)(b) of the Act on Local Taxes and Duties, the actual fact of their "occupation to conduct business activities", which the tax authorities did not prove in the case under consideration, shall be decisive and exclusive.

"Occupied to conduct business activities” has a different meaning than “related to business activities”. In fact, the premises under dispute did not lose their residential function, even though they were purchased by the company and treated as goods that are sold before 12 months elapse. Consequently, there were no grounds to tax such premises with the maximum tax rate provided for by the Act. 

In its judgment dated 12 December 2023 (case file I FSK 281/23), the Supreme Administrative Court held that the expenses incurred by a company to rent accommodation, to make it available for free to its employees, are directly linked with the company’s activities subject to VAT. As a result, the company can deduct the input tax from the invoices for rent payments.

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