On 17 June 2024, the bill amending the Act on the Agricultural Tax, the Act on the Local Taxes and Fees, the Act on the Forest Tax, and the Act on the Stamp Duty was published on the Government Legislation Center’s website.
The bill includes provisions regulating, inter alia, changes in the definitions of the terms “non-building structure” [Polish: budowla] and “building” [Polish: budynek]. The goal thereof is also to implement a recent judgment of the Constitutional Tribunal, which ruled that the definitions of these terms provided for by the Act on Local Taxes and Fees are incompatible with the Polish Constitution.
Changes to “building” and “non-building structure” definitions
The key amendments brought about by the bill consist in introducing standalone definitions of “non-building structure” and “building”, excluding references to non-tax regulations, into the Act on Local Taxes and Fees as well as enumerating the categories of structures qualified as non-building structures.
According to the new definition, a building is a structure that includes engineering systems enabling its intended use, erected using construction products, permanently affixed to the ground, demarcated by building partitions, and equipped with foundations and a roof. This definition also applies when the entity is part of a structure listed in items 1-6 of Schedule 4 to the Act. In turn, a non-building structure shall mean:
a) structures listed in Schedule 4 to the Act, including engineering systems and equipment, if - from the technical and functional point of view - they form a separate entity with that structure,
b) structural parts of equipment that do not belong to non-building structures referred to in letter a),
c) structural parts of wind farms and nuclear power plants;
d) foundations for machinery and equipment, technically separated from the machinery and equipment itself,
e) utility connections to works
– made using construction products.
Amendments relating to multi-car garages in residential buildings.
To unify taxation of multi-car garages situated in residential buildings, the bill provides for subjecting such parking spaces to the tax rate relevant for residential buildings.
Additionally, the bill is to impose the obligation to submit, in 2025, information on real estate and works (IN-1) by co-owners of multi-car garages in residential buildings.
Other amendments
The bill also provides for:
- excluding application of real estate tax exemption for land, buildings and non-building structures making up railway infrastructure;
- rewording the provision on exemption from real estate tax of land, buildings and non-building structures located in the airside areas of public airports;
- imposing on public administration bodies and bodies acting in the capacity of public administration bodies the obligation to announce any change of the competent authority in the proceedings.
New provisions are expected to enter into force on 01 January 2025.
The bill can be accessed at: https://legislacja.rcl.gov.pl/projekt/12386262/.
KPMG services
The above-described amendments are of major importance to real estate taxation. Examination of buildings and non-building structure against the taxation requirement may prove necessary.
Our KPMG Team remains at your disposal for any further information you might require.
