General ruling on reduced excise duty rates on passenger vehicles (“mild hybrids”)
Last week, a general ruling by the Minister of Finance and Economy dated 26 February 2026 on the application of reduced excise duty rates to “mild hybrid” electric vehicles (MHEV) was published. According to the Minister, the notion of “hybrid combustion-electric drive” should be interpreted in line with the literal meaning and purpose. In the Minister’s view, where a “mild hybrid” vehicle is powered by two types of drive working in tandem, namely an internal combustion engine and an electric motor, a literal interpretation requires that such vehicles be treated as hybrid petrol‑electric vehicles, to which the reduced rates of excise duty apply. The Minister further indicated that both drives must coexist and together constitute the vehicle’s propulsion system; however, they are not required to be independently capable of propelling the vehicle on their own. Accordingly, where a vehicle is equipped with an electric motor alongside the internal combustion engine, and the electric motor merely provides assistance to that engine, this is sufficient for the vehicle to qualify for the reduced excise duty rates. At the same time, the Minister indicated that the code in the Combined Nomenclature (CN) should not be considered when a decision on the use of the reduced rates is made.
Legislative summary: statutes passed by Senate
During the session held on 4 March, the Senate passed amended several statutes, including an act bringing facilitations in starting and running a business, including via the mObywatel application (from 2026, registration applications must be submitted electronically). – new regulations (with some exceptions) are to enter into force 6 days after promulgation (Druk nr 2076); The act is now to be re-submitted before the Sejm.
Furthermore, the Senate passed unamended a raft of statutes providing for, inter alia:
- exemption for certain categories of entities from filing sustainability statements (for 2025 and 2026) presenting companies’ impact in such areas as environment or corporate governance – new regulations enter into force on the day following promulgation (Druk nr 2277).
- extension of the tax exemption to in-kind prizes awarded to medallists of the Olympic Games, Paralympic Games, and Deaflympics – new regulations enter into force on the day following promulgation (Druk nr 1348).
The acts now move to the President.
SAC resolution: scope of POA for administrative court proceedings
Last week, the Supreme Administrative Court passed a resolution (ref. no. III OPS 3/25), according to which a power of attorney for administrative court proceeding before first-tier courts does not authorize the attorney to draw up and lodge cassation appeals and appeals against decisions dismissing such cassation appeals.
First family foundation bankruptcy in Poland
Last week, the District Court for the Capital City of Warsaw entered decision (case file WA1M/GU/78/2025) declaring bankruptcy of the first Polish family foundation. In the Court’s view, family foundations have capacity to be declared bankrupt and may, consequently, be declared bankrupt.
SAC: VAT point for bonuses value of which depend on distributor’s confirmation
According to the judgment of the Supreme Administrative Court entered last week in case I FSK 1367/23, in the case of continuous services in the form of pursuing quality and image‑related objectives for the benefit of a distributor by a car dealer, the service is performed at the moment the supplier receives feedback from the purchaser confirming acceptance of the degree to which those objectives have been achieved. The Court emphasized that where the amount of remuneration (such as bonuses or margins) depends on the distributor’s subjective assessment, it is only once this assessment has been carried out that the service acquires a definitive and complete character, which in turn makes it possible to determine the taxable amount.
SAC: conditions to treat services as insurance brokerage
In its judgment of 4 March (case file I FSK 1311/23), the Supreme Administrative Court held that only services consisting in intermediating in the conclusion of insurance contracts, the purpose of which is to bring about the conclusion of such contracts, qualify as insurance brokerage exempt from VAT. Where the activities performed by a company for a foreign insurance undertaking are purely technical in nature (preparing insurance products and implementing them in IT systems, as well as servicing the concluded contracts), they do not constitute brokerage services falling within the scope of the VAT exemption.
SAC: how to interpret “expenditure incurred on acquisition or taking up of shares”
Last week, the Supreme Administrative Court entered a judgment (case file II FSK 754/23) in which it held that the term “expenditure incurred on the acquisition or taking up of shares” should be interpreted according to the rules of literal statutory interpretation, without the need or possibility to rely on the provisions of the personal or corporate income tax acts. In the Court’s view, expenditure on the acquisition or taking up of shares should be understood as expenditure actually incurred by the company for that purpose. Consequently, in the case of a joint-stock limited partnership (spółka komandytowo‑akcyjna), the expenditure on taking up shares is the genuine economic burden incurred (paid) by the company for that purpose.
SAC: broad interpretation of “industrial equipment”
According to the judgment of the Supreme Administrative Court dated 4 March (case file II FSK 757/23), the term “industrial equipment”, as used in the CIT Act and in the Poland–Germany double tax treaty, should be interpreted broadly, considering dynamic technological developments and the functional purpose of the service provided. As a result, remuneration paid for the rental of development and testing environments, the provision of which is inextricably linked to the use of hardware infrastructure (servers), constitutes consideration for the use of industrial equipment, and therefore gives rise to an obligation to withhold tax at source.
SAC: taxpayer’s right to interest on overpayment arising from delay in issuing APA
Last week, the Supreme Administrative Court issued a judgment (ref. II FSK 1022/25) in which it held that a taxpayer is entitled to interest on a tax overpayment from the moment of filing an application to initiate the APA (Advance Pricing Arrangement) procedure and of the resulting restriction on recognizing tax-deductible costs, rather than only after the lapse of six months following the statutory deadline for issuing an APA decision. The end date for calculating interest is the moment the APA decision is issued. This is because once the APA decision has been obtained, the taxpayer already has the necessary procedural rights to claim a refund of the overpayment together with the relevant interest. The Court stressed that the absence of detailed provisions governing the deadline for refunding an overpayment and the period for calculating interest in cases where an APA is issued more than six months late does not negate the taxpayer’s right to interest on the overpayment.
CJEU: supplies that are ancillary to accommodation and reduced VAT rate
According to the CJEU's judgment of 5 March (in joined cases C‑409/24 to C‑411/24), EU law must be interpreted as not precluding national legislation which excludes from the scope of the reduced rate of value added tax applicable to short-term accommodation services provided in hotels and similar establishments supplies which are not directly used for that accommodation (such as the making available of parking spaces, a gym and wellness facilities, as well as access to the hotel’s wi-fi network and the provision of breakfast). In the Court’s view, it is not changed in any way by the fact that such performances could be regarded as being ancillary to that accommodation due to the fact that the remuneration for them is covered by the flat-rate overall price paid for all the services supplied in the context of that accommodation, provided that those rules make provision for the reduced rate to be applied to concrete and specific aspects of the categories of accommodation services referred to in EU law and that the principle of fiscal neutrality is complied with.
CJEU’s judgment of 5 March 2026 in joined cases C‑409/24 to C‑411/24
CJEU: how to interpret ‘voucher’
According to the judgment of the CJEU entered las week in case C-436/24, the concept of ‘voucher’ defined in EU law must be interpreted as not including the issue of points awarded by a supplier to its customers in the context of a loyalty programme under which those points are determined on the basis of the amount spent on the purchase of goods and are used by those customers to obtain additional goods offered for sale by that supplier when a new purchase is made from that supplier’s range. In the Court’s view, this is because there is no obligation for the supplier to accept those points as consideration or part consideration for a supply of goods.
CJEU’s judgment of 5 March 2026, C-436/24
CJEU: transactions involving exchange of units of virtual money of online video game for traditional currencies are not covered by VAT exemption
According to the CJEU’s judgment of 5 March (case C-472/24), transactions consisting in the exchange, for payment purposes, of real currency for units of virtual money that can be used only in an online video game are not covered by the value added tax exemption. Furthermore, in the Court’s opinion, such units of virtual money, where they give access to certain functionalities within that game, do not fall within the scope of the concept of a ‘voucher’, in particular that of a ‘multi-purpose voucher’, within the meaning of EU law. As a result, VAT must be levied on those transactions in accordance with the general rule laid down by the relevant EU directive.