Poland: Further VAT changes in 2021

Further VAT changes are expected to be introduced over the next months in 2021. The amending legislation has not been finalised yet, even though some of the changes would become effective as early as 1 July 2021. Below we briefly mention the most important of the proposed amendments.

1. E-commerce package

• The e-commerce package is to be introduced into Polish law by means of the Act of 20 May 2021 to Amend the Goods and Services Act and Certain Other Acts.
• The e-commerce package is intended to operate as of 1 July 2021 to introduce a new VAT treatment of on-line commerce all across the Union.
• The new solutions are designed to offer EU vendors a single simplified system (one-stop shop) and reduce their administrative burden.
• Generally, VAT compliance will be shifted onto intermediaries (the new definition will also specify that a delivery is to be made by or on behalf of the supplier, including where the supplier is indirectly involved in the despatch/transport; otherwise the definition follows the earlier mail order sales to/from a country).
• In addition, businesses engaged in direct on-line sales who despatch their goods to other Member States will be able to declare and pay VAT electronically on all of their e-sales in their own Member State (one quarterly filing).
• The Senate is scheduled to vote on the e-commerce package on 16 June 2021.

2. Changes to JPK V7M

• On 17 May 2021 the Finance Ministry proposed a regulation to amend the regulation on the scope of details to be disclosed in VAT returns and records (JPK VAT).
• The changes are expected to apply to special transaction and document designations:
  • the MPP designation will not have to be used on the sell side and on the buy side;
  • the TP designation will not have to be used for supplies where the associations between the customer and the supplier arise solely from associations with the State Treasury or local government authorities or their unions;
  • no duty to apply special designations to internal summary documents re. sales from cash registers "RO".
• To eliminate differences between the technical documentation (the structure of JPK_VAT with return) and the designations set out in the regulation, the drafters changed the designation style so that the old style of using "01" to "13" is replaced with the new style of using "GTU_01" do "GTU_13". Also, they added precision by including references to CN codes (CN 2020) or PKWiU 2015 classification. Certain doubts regarding the use of GTU codes were resolved, as well.
• Provisions were added to address certain technicalities of VAT compliance related to the e-commerce package.

3. SLIM VAT 2

• On 31 May 2021 the Sejm received a bill to amend the Goods and Services Tax Act and the Banking Law Act (parliamentary paper no. 1236).
• The bill proposes numerous changes to the VAT Act, including the following:
  • Having been challenged by CJEU in case C-895/19, the regulations on use of so-called "spaced array" (szyk rozstawny) for deduction of VAT on intra-Community acquisitions and imports (input tax recognised separately from output tax) are going to be repealed.
  • There will be major changes to VAT relief for bad debts following CJEU's judgment in case C-335/19 – fewer conditions, relief availability period extended to 3 years.
  • The time for deduction of input tax by adjustment will be extended, or more specifically will be allowed to be elected, as the new law will enable a VAT return to be adjusted by reference to, at the choice of the taxable person:
    • the period in which the right of deduction arose, or
    • one of the three consecutive periods of account.
  • There will be more refining changes to the triangular transaction scheme. The purpose is to introduce rules that in the case of exports or intra-Community supplies will clearly specify which supply is the one to which the despatch or transport should be ascribed where the transport is arranged not by the customer who also supplies the goods or the intermediary operator, but by the first supplier (first operator in the chain) or the last customer (last operator in the chain).
• This law is expected to enter into force on 1 October 2021, except for the "spaced array" regulations which are intended to become effective one day after publication.

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