- Opposition party to tax either bank assets or financial deals
- Law & Justice sees 19 billion zloty from tightening VAT rules
Poland’s biggest opposition party Law & Justice, which opinion polls show will win a general election on Oct. 25, wants to impose one of two taxes on the country’s financial institutions as well as a new levy on retailers to fund its spending promises.
Law & Justice is “split” on whether to introduce a tax on the assets of lenders and insurers, or a levy on financial transactions, lawmaker Henryk Kowalczyk said on Saturday. The party, which favors more government control over the economy, has promised to lower the retirement age and boost family benefits, raising concern over its ability to keep a lid on the budget shortfall.
“The goal is to finance additional spending without boosting the budget deficit,” Kowalczyk told reporters in Warsaw. The planned tax on larger retailers aims to “level the playing field for Polish companies,” he said.
The party expects to gain as much as 3.5 billion zloty ($943 million) from the planned 2 percent sales tax on large retailers, Kowalczyk said. It’s considering a 0.39 percent tax on financial institutions’ assets, which would bring in 5 billion zloty. The alternative transaction tax would generate revenues of as much as 1.7 billion zloty, according to its estimates.
Uncertainty over tax plans has helped drive down Warsaw’s WIGBank index by 17 percent from its May peak, compared with 9.9 percent decline in the broad WIG gauge.
“The fact that there are just two versions left on the table gives some more clarity,” Dariusz Gorski, an analyst at Bank Zachodni SA in Warsaw, said on Saturday. The party earlier considered taxing bank liabilities, excluding deposits.
In addition to taxing retailers and banks, Law & Justice wants to tighten value-added tax rules to gain an extra 19 billion zloty in annual budget revenue as well as close corporate tax loopholes to get additional 4.1 billion zloty.
Pawel Szalamacha, another Law & Justice lawmaker, said all the taxes could be introduced by the second quarter of 2016, if the party wins power.