KPMG Weekly Tax Review 13 MAY - 20 MAY 2024

On 16 May 2024, the Minister of Finance extended public consultations on the bill on top-up taxation of members of multinational enterprise groups and large-scale domestic groups - a constituent of the global minimum tax (Pillar II).

The extended consultations are to last until 24 May 2024.

On 17 May 2024, the bill amending the act on copyrights and related rights and certain other acts was submitted before the Lower House of the Polish Parliament.

The new regulations grant authors and performers of audio-visual works and performers of musical or textual and musical works an inalienable right to royalties on account of use of their works on the Internet. A new related right for press publishers related to the use of their press publications online is also to be introduced.

The new provisions are to take effect 30 days after publication in the Polish Journal of Laws, except for solutions related to the right to remuneration on account of online distribution of a fixed performance, which are to enter into force 6 months after promulgation of the act.

On 14 May 2024, the Council of the EU reached an agreement on a proposal for a Directive on Faster and Safer Tax Excess Relief (FASTER).

The directive will introduce a common EU digital tax residence certificate that tax paying investors would be able to use in order to benefit from the fast-track procedures to obtain relief from withholding taxes.

The European Commission has also proposed two relief systems:

• a “relief-at-source” procedure where the relevant tax rate is applied at the time of payment of dividends or interest,
• a “quick refund” system where the reimbursement of overpaid withholding tax is granted within a set deadline.

Member states will have to decide whether to use one or both of them.

The amendments still must be discussed by the Council of the EU with the European Parliament. Next, the Ministers will be able to formally adopt the Directive and the Member States will have to transpose the FASTER Directive by the end 2028.

According to the judgment of the Supreme Administrative Court, issued on 14 May 2024 in case no. I GSK 1166.30, for the excise duty obligation to arise, transfer of the right to dispose of passenger cars as owner must be identified. If the Czech company only uses these passenger cars under lease to then make them available to its employees working for its Polish branch, such a transfer does not take place.

According to the judgment of the Supreme Administrative Court dated 9 May 2024 (case file II FSK 951/21), the costs of accommodation incurred by an employer posting a worker, as part of service provision, to another Member State do not constitute that worker’s revenue, defined as the value of other free-of-charge benefits within the meaning of Article 12(1) in conjunction with Article 11(1) of the PIT Act. Since identical benefits are also provided by the employer to workers posted outside the EU, it should be assumed that also in such cases there will be no grounds to assume that such workers obtain free-of-charge benefits within the meaning of Article 12 of the PIT Act. All benefits related to accommodation of workers by the company should be, in fact, deemed incurred in the interest of the employer, which is why they do not give rise to tax obligation on account of free-of-charge benefits for the employees.

According to the judgment of the Regional Administrative Court in Poznań, rendered on 14 May 2024 in case I SA/Po 152/24, the term “disposal” referred to in Article 5(1)(1) of the Family Foundation Act should be understood as comprising various titles of transfer of ownership or rights to other entities. Consequently, in-kind contribution, understood as joining a company or a partnership, falls within the scope of this article's hypothesis. Nevertheless, Article 5(1)(3) of the Family Foundation Act should be applied in the first place, since it has a role of a special provision, dominant with regard to other regulations set forth by point 1 of that Article. Thus, any possible revenue from taking up shares in a company by a family foundation should be subject to CIT exemption.