Draft Changes to the Tax Ordinance - Individual Tax Interpretations

The Ministry of Finance has initiated consultations regarding significant changes to the Tax Ordinance - until August 31, you can submit your comments on the draft along with justification. We plan to submit our comments in an innovative GIF format as below, currently awaiting feedback :)

❓What's the deal? Tax regulations are subject to interpretation by tax authorities and officials, and these interpretations can differ drastically. To ensure that a taxpayer's actions, method of settlement, use of exemptions, etc., are correct and to avoid receiving a tax decision with fines, penalties, and interest to pay in five years because "it should have been done differently," we often rely on the institution of Individual Tax Interpretation - with a faithful description of the factual situation and obtaining a confirmed IPP, the taxpayer had the assurance that their filings would not be challenged (retroactively!) in the future.

This solution was advantageous for taxpayers because the application fee for one question for one factual situation was only PLN 40. 💸One of the proposed changes is to increase this fee (for companies and individuals conducting business activities) from 40 to... up to PLN 2800. A subtle increase of 7000% 😁

❗️What's crucial is that this is not a fee for the application but still for one question - however, it rarely happens that an application covers only one question. The new fee (depending on the type of interpretation - PLN 400, 1400, or even 2800) will have to be multiplied by the number of questions. For many taxpayers, the amount may be prohibitive.

⌛️But that's not all. The planned changes introduce an expiration date for issued interpretations - up to 5 years. "Phew, fortunately, in accordance with the principle of protection of acquired rights, this will not apply to interpretations already issued," thought all rational taxpayers... Well, it will. If the changes come into force, all interpretations issued before 2019 will become obsolete as of January 1, 2024. To continue benefiting from protection, it will be necessary to renew it - of course, for an additional fee.

The justification for the changes indicates that the costs of issuing interpretations are much higher than the fee submitted with the application. Perhaps the policymakers should be reminded that taxpayers would not need to use this institution if the existing regulations clearly and uniformly defined their rights and obligations?