European Commission Opens Investigation into Polish Tax Scheme for Shipyards
Illustration; Image Courtesy: Remontowa Shiprepair YardThe European Commission has opened an in-depth investigation into a Polish tax scheme for shipyards as it is concerned that the scheme would give some shipyards a selective advantage over competitors.
“The commission has concerns that the proposed flat-rate sales tax constitutes so-called operating aid, which uses public funds to relieve shipyards from costs they would otherwise have to bear in their day-to-day activities,” EC said in a statement.
“In the present case, the commission is concerned that the aid would harm shipyards in the EU, which are not eligible under the Polish tax scheme. In addition, the aid does not seem to be necessary, given that there are shipyards in Poland which are able to compete on the market on their own merits,” the commission added.
In September 2016, Poland adopted a law giving shipyards operating in Poland an option to pay a 1% flat-rate tax on sales from the building and conversion of ships, instead of paying the generally applicable corporate or personal income tax. In addition, the payment of the flat-rate tax is postponed until the building or conversion of a ship is completed.
Separately, EC has approved Polish investment aid to small and medium-sized enterprises (SMEs) in the shipbuilding sector. This measure is expected to encourage new investment and benefit regional development in Poland.
The scheme aims to support SMEs in the shipbuilding sector in the Polish Pomorskie and Zachodniopomorskie regions. The aid will take the form of grants, interest-rate subsidies and guarantees.
The overall budget is around PLN 77 million (around USD 22.6 million).
