Tougher tax inspections after 1 March

Tax administration reform and new rules of tax inspections come into force on the first of March. The Ministry of Finance is on war with tax fraudsters and is determined to bring white collar crime down and budget revenue up. During the recent press conference, Mateusz Morawiecki, Polish Deputy Prime Minister and the Minister of Finance, announced “the beginning of a new era”.

The newly created body that will replace the existing tax control units, Krajowa Administracja Skarbowa [National Fiscal Administration] (KAS) got equipped with a lot of power when it comes to inquiry proceedings. Tax inspectors will be now allowed to launch compliance checks immediately, unannounced, and at any place related to company operations, not only the company’s seat but for example the place where accounting books are kept. They will have the right to question witnesses, request experts’ opinions, search and freely access company premises as well.

The lawmakers introduced tougher penalties for tax-related crimes. Issuing fake invoices in the amount exceeding 10 million PLN will be punishable by up to 25 years of prison time. If the value of the fake invoice is less than 10 million PLN but more than 5 million PLN, the offender may go to jail for 5 to 15 years. The Ministry of Finance officials believe the new law will be a strong instrument for fighting and preventing VAT fraud.

Last year, Polish tax authorities revealed tax frauds in the amount of more than 22 billion PLN. A vast majority of inquiries concerned VAT tax settlements. Officials hope for even better results in the months to come. Mateusz Morawiecki recently stated that due to white collar crime Polish budget annually loses from 30 to 60 billion PLN.

Marian Banaś, the chair of Krajowa Administracja Skarbowa and Deputy Minister of Finance, believes the new institution will be friendly to citizens, will support honest taxpayers and also fight the grey economy. He stressed the new fiscal authority will be modern, unified, and effective.

What This Means for Businesses in Poland

Tax policy changes in Poland have direct implications for both domestic and foreign-owned businesses. Companies operating in Poland must stay informed about regulatory developments to optimize their tax position and maintain compliance. The Polish tax system includes CIT (19% standard, 9% for small taxpayers), VAT (23% standard rate with reduced rates of 8% and 5%), and various sector-specific levies.

For international entrepreneurs and investors, understanding the Polish tax landscape is essential for business planning. Poland offers several attractive incentives including the Polish Investment Zone (up to 15 years of CIT exemption), R&D tax relief (up to 200% deduction), and the IP Box regime (5% effective CIT rate on qualified intellectual property income). Professional tax advisory can help identify the most beneficial structure for your specific situation.

The interplay between Polish domestic tax law and international tax treaties is particularly important for foreign-owned entities. Transfer pricing regulations, withholding tax provisions, and anti-avoidance rules (GAAR) require careful navigation to ensure both compliance and optimization.

If you are doing business in Poland or considering entering the Polish market, Zalewski Consulting can help. Learn more about our tax advisory services in Poland, or contact us for a free consultation.