VAT changes as form 1 July

New VAT rates matrix

The coronavirus pandemic postponed the date of entry into force of the new VAT matrix from 1 April to 1 July 2020. The new provisions aim at simplifying the existing system by amending and unifying the classification of goods and services for VAT purposes.

Simplification of the existing VAT system:

• an introduction of a single tax rate for product groups (e.g. bread and pastry products - one 5% rate instead of 5, 8 and 23% depending on products` ingredients and their expiry date),
• a reduction of rates for certain goods (e.g. tropical fruits and citrus fruit - from the current 8% to 5% or e-books and certain books from the current 23% to 5%),
• an increase in the rates for selected goods (lobsters and octopuses and other crustaceans, molluscs and aquatic invertebrates and their preparations, caviar and caviar substitutes - from 5% to 23%).

The new VAT rates matrix, i.e. VAT on goods and services, also introduces changes in the application of the Polish Classification of Goods and Services - PKWiU. In case of goods, PKWiU from 2008 is replaced by the Combined Nomenclature (CN) and in case of services by PKWiU from 2015.

Tables with the list of goods and services subject to preferential VAT rates of 5% and 8% were transferred to the amended VAT Act.

Binding Rate Information (WIS)

Binding Rate Information WIS issued before 1 July 2020 will bind tax authorities for transactions made after 30 June 2020

Settlement of import tax

The entrepreneurs may also expect changes in the settlement of import tax. Starting from 1 July 2020, it will be possible to settle the tax on import of goods directly in the tax return. This solution will be available to the following entities:

• registered as active VAT payers provided that:
  • they have a certificate of registration as an active VAT payer issued not earlier than 6 months before the time of import
  • they have a certificate of no arrears in payments of social security contributions due and in payments of taxes constituting State budget revenue, exceeding respectively 3% of the amount of due contributions and due tax liabilities; the share of arrears in the amount of contributions or tax shall be determined against the amount of due payments for the settlement period to which these arrears relate

• making customs declarations through a direct or indirect representative under the customs regulations.

The taxpayers will have time to pay VAT until the 25th day of the following month at the latest. So far, it has been 10 days from the date of customs clearance or the date of the customs decision.

White list of VAT payers

On June 25, 2020, the Ministry of Finance published a draft bill concerning a new template for notification of dues paid to an account other than the one set out on the day of transfer order and included in the list of entities called the white list and the extension of the time limit for notification of such payments from 3 to 7 days. Payments to an account other than the one included in the white list for an amount exceeding PLN 15 thousand are subject to notification.

The draft also includes a proposal to change the jurisdiction of the head of the tax office, to which the notification should be submitted, from the one appropriate for the seller to the one appropriate for the person who pays an amount due.

The changes aim at simplifying the notification procedure, however, the new template of notification ZAW-NR includes fields for payment details, such as the amount paid by bank transfer and the date of transfer order.

The new regulation enters into force on the day following its publication in the Journal of Laws.