Fiscal wants the highest tax on the mere possession of real estate
A residential building leased by an entrepreneur should be deemed to be occupied for the conduct of business activities, even if the tenant only pursues residential purposes therein, according to the answer to an MP's interpellation provided by the Minister of Finance.
This means that we are again returning to a widely commented and controversial topic, namely: the tax office wants the highest property tax on the mere fact of owning buildings, and not on their actual use. A similar position is presented by some administrative courts. According to the tax authorities, if an entrepreneur has a building which he rents out, but the tenant uses it for residential purposes, property tax should still be paid at the rate as for a business, because the entrepreneur owns it. And let us remember that the tax associated with a business is several times higher than that paid for residential purposes.
– Unfortunately, once again, both the Minister, when replying to the interpellation (No. DSP13.844.59.2022) and some of the administrative courts forget about the Constitutional Tribunal’s ruling (ref. SK 39/19). The Court clearly ruled that the mere possession of a building or premises by an entrepreneur cannot determine the tax rate. What is crucial is the actual use of the property in question in the business conducted. When interpreting the provisions of the Local Taxes and Fees Act, this ruling of the Constitutional Tribunal should be taken into account, recalls Piotr Kalemba, tax adviser, senior manager at Thedy & Partners.