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POLAND: Potential Tax Cuts in 2019

Deputy Prime Minister and leader of PiS’ ally the Agreement party Jarosław Gowin announced that in 2019 Poles might see tax rates cuts. Details of tax cuts are expected to be announced by PM Mateusz Morawiecki early next year.  According to Gowin, throughout the past 3 years, the government took care of those with the lowest income by introducing various social programmes such as Family 500+.  Lowering certain taxes would be a sing that the government aims to concentrate on the middle-class, Gowin suggested. This appears coherent with speculations that the ruling camp will attempt to broaden its voter base ahead of the general and European Parliament elections. The announced tax cuts are likely to be well received by the public, however, their effect on the economy will depend on how substantial they are. Lower taxes in conjunction with the improved tax collection system have the potential to stimulate the economy – increase consumption and investment. Still, lower taxes may negatively affect the state budget and the ongoing social programmes, especially if they are designed to function on a mass scale quickly.