Transfer pricing is the subject of growing interest of the Polish tax authorities

Transfer pricing is the subject of growing interest

On 18 August 2016 the Ministry of Finance has published another press release, indicating actions that the tax authorities will take in order to reduce tax frauds and to close loopholes in the tax collection system.

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Transfer pricing is the subject of growing interest of the Polish tax authorities

According to the press release, the priority of the Ministry of Finance is to reduce harmful tax "optimization" by combating artificial activities/schemes, primarily used by multinational corporations and actively limiting frauds with regards to transfer pricing.

The Minister of Finance has justified the new steps taken in order to close loopholes in the tax system with the following data:

  • in the period 2008 - 2015, the Polish economy grew by 39.16 percent while receivables from CIT dropped by 4.95 percent
  • the share of CIT revenues in GDP fell from 2.11 percent in 2008 to 1.44 percent in 2015.

 

New competences of the Department of Tax System

As previously announced, the Ministry of Finance has taken its first steps to reduce tax frauds, including the creation of a competence center in the Department of Tax System, which is responsible for the following tasks:

  • prevention of tax avoidance throughout the use of the General Anti-Abuse Clause
  • conclusion of agreements on recognition of the correctness of choice and use of transfer pricing methods
  • supervision of the coherent application of tax law (in particular curtailing the practice of "legalization" of abusive schemes by the interpretation system).

Anti Tax Avoidance Council

The creation of the Anti Tax Avoidance Council (by 13 September 2016) should also close loopholes in the tax collection system. This body will be responsible for issuing opinions on the applicability of the clause in tax proceedings.

The full text of the press release of the Ministry of Finance in Polish may be found at the ministry site.

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