Poland’s self-governing government has put in place measures to boost spending and reduce taxes, as part of a program to boost the economy after the epidemic.
The Polish Deal, which includes housing, retirement and family support, and tax cuts for low-income and middle-income earners, is known as the Law and Justice Party (PiS )’s efforts to establish and stabilize the recent 2023 parliamentary elections. .
Like most countries in the EU, Poland has been devastated by Covid-19, as the epidemic killed more than 70,000 people and restored economic growth for the first time in 30 years.
Prime Minister Mateusz Morawiecki said the Polish Alliance – which would be honored with loans and money from the EU recovery fund – was an opportunity to fulfill the Poles’ dream of achieving prosperous western Europe, as well as developing the country’s middle class.
“We have a great opportunity ahead of us,” he said. “[In the past] we always have to worry about freedom being oppressed by outsiders. But today, we can uphold our right to choose the laws for economic and economic growth in the best interests of our country of Poland. ”
As part of the reforms announced on Saturday, PiS and its two smaller organizations are planning to increase funding for non-funded health groups, some of which are affected by the epidemic, from 5% of GDP in 2020 to more than 7% in 2030.
Taxes will also be adjusted. Tax-free taxes receive 30,000 zł, and the limit for Poles starting to pay the highest 32% tax will rise from 85,000 to 120,000 zł per year.
Mortgage lending laws have also been changed to ensure that children do not have to worry about buying property, while building regulations have been ignored. There will also be other benefits for families with young children, as well as retirees, as well as a financial program that PiS said will create 500,000 new jobs.
Morawiecki and his allies at the congress of the ruling party did not comment further on financial matters.
Jaroslaw Gowin, deputy prime minister and head of the Alliance, one of the smaller members of the PiS coalition, agreed that rich Poles should pay more taxes, but did not specify details. He also said that the state budget would be cut.
Poland’s finance minister Tadeusz Koscinski told FT that tax cuts were also helping to accelerate growth. However, he added that the reduction in wages was also due to the payment of social security payments to workers and businesses, due to changes that would force more workers to secure employment opportunities, and the removal of the social security pay cap for self-employed workers.
Koscinski said the annual cost to the state budget should be taxed at about 7bn zł. He also said that there will be 3bn zł to re-finance the operation of local governments that have lost money due to taxes.
Adam Czerniak, an economist at Polityka Insight, said the government’s plans for rapid growth, which help pay for the state’s intelligence, “are good, but I think it could happen.”
However, he expressed concern that housing reform – which includes government guarantees on mortgage loans for young people – could bring about a thriving market.
“Payment guarantees are risky at this point in doing business in the real estate market,” he said.