POLAND: New deputy PM: bright future of Polish economy

The Polish government will implement cuts to personal income taxes and a tax exemption for the young by late summer or early autumn, deputy Prime Minister Jacek Sasin said in an interview for the daily Dziennik Gazeta Prawna.

The PIT exemption for young workers should be in place by August 1, he said. All earnings in Poland’s first tax bracket will be exempt for workers up to age 26, he indicated. Tax withholding will stop from day one, giving an immediate earnings boost, he added.

A bill increasing the cost of earned income deduction and reducing the bottom tax bracket by 1 ppt to 17% could come into force "by October, perhaps already by September," he said.

"I can guarantee that all earners will be paying lower personal income taxes," Sasin declared.

Poland enjoys a strong fiscal position where spending efforts have been unable to keep pace with revenue growth, Sasin added. "That limits our possibilities, but for the revenue side I am absolutely calm," he said. But new major social policy initiatives are not yet planned. "Certainly nothing in the scale from the prior four years, although I can’t say there won’t be any pro-social initiatives," Sasin said.

Spending increases to date are "not big" and fully justified as "strong public finances are not a value in and of themselves: they are a value if they allow you to realize state policy."

Challenged if Poland shouldn’t be stashing money away for the lean years, Sasin argued that Poland faces little but fat. "We are optimists about the future of the Polish economy, although we aren’t just floating in the clouds," Sasin said.

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