Poland: Proposed reforms to tax incentives system in light of Pillar Two

Government is considering introduction of cash grant regime in lieu of existing investment zone and R&D tax credit regimes

The government on October 4, 2024, announced proposed reforms to the tax incentives system in light of the global Pillar Two implementation.

Specifically, the government is considering introduction of a cash grant regime as an alternative to the current Polish Investment Zone regime (exemption from corporate income tax on qualifying investments) and research and development (R&D) tax credit regime.

The new system would offer cash grants to taxpayers on an annual basis over a period of 15 years.
The amount of financial support would depend on the investment value, the location, quality criteria, as well as annual revenue and gross profitability (i.e., no grants would be given in unprofitable years).
In addition, the option to enable taxpayers to settle existing R&D tax relief as part of the current tax or on the basis of an application for a refund of the unused relief (within three years from the year in which the eligible costs regarding the relief were recognized) is also being considered.

Read a November 2024 report prepared by KPMG's EU Tax Centre

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Poland: Proposed reforms to tax incentives system in light of Pillar Two

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