PZU Jumps Most in Three Months After Tax Proposal Watered Downby and
Parliament committee opts for lower tax rate than expected
Insurers to have tax allowance reduced in levy set for 2016
PZU SA jumped most in three months as lawmakers watered down the size of a planned tax on Polish insurance companies.
Shares of the country’s largest insurer rose as much as 3.4 percent, the most since Sept. 17, and closed up 1.5 percent at 34.71 zloty. The parliamentary financial committee voted for an annual tax rate of 0.39 percent compared with an earlier proposal of 0.6 percent. It also recommended on Tuesday to reduce the tax allowance for insurance companies to 2 billion zloty from 4 billion zloty in original draft law. The levy, which is to be introduced next year, must still be approved by parliament.
“If passed, this would be a positive surprise as it seemed the government’s priority was to get financing for planned spending,” said Michal Konarski, an analyst at MBank SA. The amendment will cut planned the annual burden for PZU by a third to about 230 million zloty ($59 million), according to his calculations.
The government expects revenue from the tax on financial institutions to total about 4.8 billion zloty next year, provided the new levy takes effect from Feb. 1, Deputy Finance Minister Konrad Raczkowski told reporters today. The changes made by the committee today include taxing payday lenders with the allowance for them set at 200 million zloty.