Poland: Sugar tax and tax on alcoholic beverages under 300 ml

Since the start of 2021, to stimulate health-focused consumer choices, two taxes have been in place in Poland - a sugar tax and a tax on alcoholic beverages under 300 ml in volume, intended for consumption outside the place of sale.

However, the introduced regulations have raised many interpretation doubts from taxpayers. In response, the Ministry of Finance has published a draft Act amending the Public Health Act of 11 September 2015 regulating the above issues to clarify the provisions and remove the interpretation doubts that have arisen.

The draft provisions are at the very early stage of the legislative process and have not yet been referred to the Sejm (lower house of the Polish parliament). This means that they could be changed or not introduced.

Key changes in sugar tax

Taxation of concentrates

The current wording of the regulations lacks clarity regarding the products that should be covered by the sugar tax. In particular, there are doubts whether these provisions also cover concentrates intended for production of ready-to-drink beverages.

Under the amendment provisions, the definition of a beverage has been changed, specifying that the term should be understood as ready-to-drink beverages and all beverages in concentrated form: liquid, semi-liquid and solid. The change is aimed at eliminating the sale of concentrates without a tax and equalizing the proportionality of taxes on concentrates and beverages for direct consumption. However, concentrates are to be taxed slightly differently from finished beverages - at a separate rate per litre or kilogram of concentrate.

The taxpayer and multiplied payment

Under the current wording of the regulations, it is difficult to determine which entities in the supply chain are obliged to pay sugar tax. The proposed provisions shift the obligation to pay sugar tax from those who perform retail sales or sell beverages to retail outlets (wholesalers) to manufacturers, importers and intra-community buyers of beverages. The latter will be given the opportunity to reclaim the tax. This applies to intra-community delivery or export of beverages, as long as the tax is paid within the country.

However, the mechanism will limit the possibility of reimbursing the entity that paid the tax and the first purchaser who purchases the beverages directly from the entity obliged to pay the tax and then takes them outside the territory of the country as part of an intra-community supply or export. The tax will be refunded at the authorized entity’s application submitted to the relevant head of the tax office within three months from the date of the intra-community supply or export. It will be necessary to evidence the basis of the submitted application.

"Introduction to the domestic market"

The change in the definition of "introduction to the domestic market" covered by sugar tax is expected to put an end to the unequal treatment of market participants benefiting from sellers offering products via the Internet. This is because until now, as the Polish tax authorities have confirmed in individual interpretations, sales to consumers exclusively at a distance, via electronic communication means, were not subject to the sugar tax. To change this, the statutory definition will now refer to "supply the beverages", understood as, i.a. as a transfer of the ownership of the beverages instead of retail sales. Thus, beverages sold online will be subject to sugar tax under the new law.

Mitigation of penalties

The draft includes a reduction in the penalty for failing to pay sugar tax on time - the penalty will no longer be 50% of the amount of the sugar tax due, but 25% or 50% of the amount underpaid.

Key changes in the tax on alcoholic beverages under 300 ml

Obligation to inform about the payment of the tax

The first problem that arises with the current wording of the regulations is the ability of entrepreneurs to verify whether the entity from which they purchased alcoholic beverages has fulfilled its obligation to pay the fee to the tax office's account. This posed a practical problem, as entrepreneurs who wanted to resell the beverages they bought from a wholesaler to another entrepreneur and at the same time had a retail permit had to pay the fee. The Ministry of Finance plans to eliminate this problem by making it mandatory for entrepreneurs to inform their business partners that they are not required to pay the fee along with the invoice for the goods.

The moment when the obligation to pay arises

In response to doubts about the moment when the obligation to pay arises, the draft clarifies that the obligation to pay the fee, resulting from the purchase, arises on the date: 1) of the delivery of alcoholic beverages to another entrepreneur holding a permit for the retail sale of alcoholic beverages for consumption outside the place of sale, including when this entrepreneur also holds a permit for the wholesale of alcoholic beverages; 2) the transfer of alcoholic beverages to its own retail outlet.

The ALK information

The draft also simplifies the submission of ALK information - it will be possible to submit one document in total for all the permits held (not separate ones, as for now). Also, the detailed scope of data to be included in the ALK, for the avoidance of doubt, will be indicated in a regulation of the Minister of Finance.

Mitigation of penalties

The draft reduces penalty provisions - an additional late fee will not be charged if the due date for payment expires during ongoing proceedings initiated at the taxpayer's request (filed before the due date) for deferment of the fee or payment in instalments. The deadline for payment of the fee will be 14 days from the date of delivery of the decision, unless the decision specifies another payment deadline. In addition, the proposed amendments will liberalize the existing regulations on the additional (sanction) fee by specifying cases when the additional fee will not be collected.


Link to the draft: https://legislacja.gov.pl/docs//2/12365351/12920367/12920368/dokument581429.pdf

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