The latest edition of the TMF Group Polish Barometer highlights six positive and six challenging regulatory changes that impacted businesses in Poland during the last quarter of 2024. The report also outlines the biggest challenges for companies in 2024 resulting from new regulations, such as the minimum CIT rate, changes to real estate taxes, and the Whistleblower Protection Act.
TMF Group, a global compliance and administrative services provider with offices in 87 jurisdictions (including two in Poland), prepares the Polish Barometer report. Experts from its Katowice and Warsaw offices analyze key accounting, tax, and administrative changes affecting businesses in Poland.
Key Regulatory Changes in Q4 2024
The TMF Group Barometer evenly divides the regulatory changes into positive developments and challenges for businesses.
Among the challenges is the FASTER directive, adopted in December, which aims to simplify the process of withholding tax collection for investors. The directive allows taxes to be withheld at the correct rate for the investor’s country of residence and provides a mechanism for faster tax refunds.
“While the FASTER directive is good news for investors, it poses significant challenges for businesses, particularly financial intermediaries, who will need to adjust their systems to comply with the new rules,” said Magdalena Grzegorczyk, TMF Group expert.
Other regulatory changes include the Digital Services Act (DSA), the implementation of the NIS2 Directive, and the Artificial Intelligence Act:
- The Digital Services Act (DSA) establishes unified rules for removing harmful and illegal content and grants commenters the right to appeal content removal decisions. TMF Group experts highlight that this regulation will require media owners (and businesses enabling comments) to implement robust content monitoring and appeal processes, posing significant organizational challenges.
- The NIS2 Directive requires businesses in 17 critical sectors, such as digital services, energy, transportation, and finance, to replace high-risk IT software or hardware within seven years (or four years for telecoms).
- “NIS2 presents a massive organizational and financial challenge for businesses, particularly smaller companies. The criteria for identifying high-risk suppliers remain unclear, which is worrying for entrepreneurs,” added Magdalena Grzegorczyk.
- The Artificial Intelligence Act regulates the use of high-risk AI systems affecting privacy, health, and safety. The regulation will require companies using such systems to withdraw or modify them. Organizations will also need to invest in staff training or external experts to ensure compliance, as fines for non-compliance could reach €35 million or 7% of global turnover.
Positive Regulatory Changes in Q4 2024
On the positive side, the extended maternity leave introduced in Q4 2024 offers parents and caregivers of premature babies an additional 15 weeks of leave.
“The new regulations provide parents additional time to care for premature or ill newborns without fear of income loss or job security. The 100% maternity benefit ensures financial stability, allowing parents to focus on their child’s needs. This solution also accommodates various parenting models, including adoption and foster care,” explained Anna Jendo, TMF Group expert.
Other positive developments include:
- A cross-ministerial task force to combat the shadow economy, aiming to level the playing field for tax-compliant businesses.
- A general interpretation on withholding tax for dividends issued on November 20, which provides clarity and helps resolve ongoing disputes with tax authorities.
Mixed Impacts of Certain Regulations
Some regulations introduced in Q4 2024 had both positive and negative impacts:
- The FASTER Directive, while beneficial for large multinational companies, challenges financial intermediaries due to procedural changes.
- The CSRD Directive, which requires precise non-financial reporting from 3,800 companies (and indirectly affects approximately 100,000 of their partners), may increase transparency and trust in businesses.
- The general interpretation of withholding tax from November 27, clarifies exemptions but imposes stricter compliance requirements.
“While the CSRD Directive imposes reporting burdens, it could improve companies’ access to financing and help attract employees who prioritize sustainability. Similarly, the FASTER Directive simplifies dividend and interest payments for multinational corporations, despite challenges for intermediaries,” summarized Magdalena Grzegorczyk.
Regulatory Highlights of 2024
Looking at the year as a whole, TMF Group experts identified key regulatory changes, both positive and challenging:
Positive changes:
- Introduction of cash-based PIT,
- Contribution holidays for entrepreneurs,
- E-delivery services,
- Digitalization of Poland’s tax administration system.
Challenges:
- The minimum CIT,
- The Whistleblower Protection Act,
- Changes to real estate taxation.
Conclusion: Balance Between Challenges and Benefits
“Both our Q4 Barometer and the analysis of major 2024 regulations show a balance between challenges and benefits for businesses. On the positive side, there’s significant progress in digitalizing processes and improving communication between businesses and public authorities. However, complex regulations and those requiring significant organizational investment remain a challenge for businesses,” said Joanna Romańczuk, Director of TMF Group in Poland and Northern Europe.
Source: CEO.com.pl
