WARSAW, 19 November 2015 — According to the latest “Paying Taxes 2016” report, prepared by PwC, a consulting company, and the World Bank Group, Poland is currently on the 58th position when it comes to the degree of complexity of tax systems worldwide. It represents an improvement by 29 positions compared to the last year’s ranking. The first place in the “Paying Taxes 2016” ranking was claimed by Qatar, while the last one (189th) — by Bolivia.
The results of the Report indicate that an average Polish entrepreneur currently makes 7 annual tax payments (as compared to 18 last year), allocating 271 hours per year for this purpose (previously — 286). Total tax rate for Poland amounts to 40.3% (in last year’s study, this rate amounted to 40.1%). Against data for all European Union Member States, Poland is doing relatively well in terms of the number of annual payments (the average for the EU and EFTA is 11.5) and in terms of the total tax rate (40.6% in the EU and EFTA). However, the number of hours spent on tax-related issues is considerably less advantageous in comparison — the average for EU and EFTA states is 173 hours.
Ever since introduction of the “Paying Taxes” report — i.e. since 2004 — the Polish tax system has been successively improving its position on this list. To a large extent, this is due to Poland’s presence in the European Union and the necessity to adjust the tax law to EU standards. Using the best solutions available in other EU Member States, we are slowly closing the gap separating us from western countries by making it easier for entrepreneurs to settle tax-related issues. We owe this considerable step up on the Paying Taxes list, among other things, to implementation of large-scale electronic settlements with the tax office as a part of the “e-podatki” [“e-taxes”] programme.
Poland’s 58th position in this year’s ranking suggests, however, that many important issues within the scope of friendliness of the tax system still remain to be solved. PwC experts stress that one of the challenges faced by the tax administration is changing its approach to entrepreneurs, manifested in actions such as onerous tax inspections or different interpretations of the same provisions by different tax authorities.
“Taxes are essential to finance public services and development. The design of a tax system can influence firms’ decisions on whether to operate in the formal sector. It’s encouraging that economies worldwide, including Poland, continue to introduce substantial improvements in their tax environment. It means both an easing of the burden on business, and sustainable revenues for governments” – says Augusto Lopez-Claros, Director, Global Indicators Group, Development Economics, World Bank Group.
“The results of this year’s Paying Taxes study confirm that the Polish tax system has changed for the better. However, we must not forget that there is still a lot of work to do. One of the examples can be introducing a single template of a property tax declaration or changing the tax administration’s approach to entrepreneurs for more friendly. Resolving these issues can not only help us achieve better positions in the Paying Taxes ranking, but first and foremost — it can positively stimulate the development of Polish entrepreneurship, which is the decisive factor for the economic future of our country” — sums up Tomasz Barańczyk, managing partner of the legal and tax department at PwC.