Polish governance: Changes in the health contribution not yet determined
From 2022, the health contribution is to amount to 9%, and the basis for its assessment is to be the income generated by the company. Additionally, the option to deduct it from tax will disappear. This means a sharp increase in the fiscal burden for businesses. No wonder that voices of criticism are raised.
Such solutions have been included in the draft amendment to tax regulations under the Polish Order programme, which is to come into force as soon as on 1 January. The proposed modification of the rules of paying and settling health contributions will result in entrepreneurs having to pay much more to the treasury than today. And the change will hit the pockets of taxpayers running one-person businesses (usually those who are self-employed) the hardest.
– Fierce criticism of the idea by tax experts, but also business organisations, has probably made the Ministry of Finance reconsider the idea. In an interview with TOK FM, Łukasz Czernicki, chief economist at the Ministry of Finance, confirmed that the ministry is considering the option of setting the healthcare rate at 3%. Then, the contribution would be gradually increased in subsequent years. This could result in a lower tax increase,” Adam Allen, tax advisor and partner at Thedy & Partners, said.
At the same time, he adds: ‘Businesses are still dealing with the effects of the pandemic and the restrictions that are inherent in it. This is not a good time to burden business with the additional hurdle of a higher tax burden.”