After more than two years in the works, the first reading of the draft act on Special Hydrocarbon Tax (SPW) will take place in Sejm. – It is a positive development, as a lack of guarantees for a stable tax law was the main cause for several foreign entities’ withdrawal from planned shale gas search investments in Poland – reminds expert of Employers of Poland Mariusz Korzeb.
The act is intended to provide an investment impulse for Polish economy and ensure a Just allocation of profits from the sale of fossil fuels, including shale gas and oil between the state and entrepreneurs. However, it is hard to agree with both of those objectives, as the very obligation to pay a public due, regardless of its value, leads to increased tax burden and, as a result, to a decrease of company assets.
Unfortunately, the act increases the value of Mineral Resource Rent Tax from ca. 21 percent to ca. 40 percent. This means that entrepreneurs will be obliged to pay two additional taxes. The first is the mining tax for selected fossil fuels (natural gas, shale gas and oil). The value of this tax will be between 1.5 percent and 6 percent. The other obligation is the Special Hydrocarbon Tax (SPW), with a value of 0 to 25 percent.
The presented draft of the act, which will come into force on January 1st 2015, removes the obligation to pay the Special Hydrocarbon Tax and the tax for selected fossil fuels until 2020.
Starting in 2015, taxpayers will have evidence and tax declaration obligations. Tax declarations will have to be sent monthly, until the 25th of every month for the month before, annual declarations will until the end of March.
Mariusz Korzeb, expert of Employers of Poland