On May 13th 2016, the Parliament adopted the draft amendment to the Tax Code, which provides for the introduction of a clause against tax evasion. The clause is an important element of the tax system sealing policy announced by the Government.
241 MPs voted for the bill, 44 were against, and 152 abstained from voting. The clause against tax evasion is to stop taxpayers from the use of the so-called "aggressive tax optimization". It involves the implementation of artificial and non-economic justification for actions allowing to achieve tax benefits.
The provisions themselves do not raise controversy but their application in practice does. Businesses fear that the tax administration will use the clause against them. There is a risk that companies may be unduly made subject to a clause, although in fact their purpose is not tax avoidance. The risk arises from the fact that the draft contained many vague terms, leaving a lot to the discretion of officials. In addition, there is a likelihood of a conflict between taxpayers and tax authorities about interpretations of the meaning and validity of some business activities that may be challenged and found to lack economic justification.
However, there is no doubt that an effective fight against tax evasion should be one of the priorities of the state administration, as unfair actions of some entities hit not only in the Treasury, but also interfere with the conditions of fair competition. In order to eliminate the risks to taxpayers, tax administration officials should be trained both in the application of the clause, as well as in economics and modern models of business management prior to new provisions entering into force. In addition, only the most qualified officials should take on cases regarding this clause.
Łukasz Czucharski, Tax Committee of Employers of Poland