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Changes in VAT closer and closer – quick fixes since July


On May 28, 2020, the Sejm (the lower house of the Polish parliament) passed an amending act concerning the tightening of the corporate income tax system, amendments to the VAT Act connected with the implementation of the EU Council Directive 2018/1910 and completing the transposition of the MDR Directive. The legislative process is still ongoing and the work on the law is currently being carried out by the senators.

The adopted amendments concern primarily the VAT Act (the so-called ‘quick-fixes package’). They will enter into force on July 1, 2020.

Currently (i.e. until the entry into force of the regulations implementing Directive 2018/1910), according to the statement issued by the Ministry of Finance, taxpayers have freedom of choice in application of abovementioned Directive or domestic regulations under the condition that they do so consistently in all aspects related to VAT settlement of a given transaction.

The most important regulations included in the bill adopted by the Sejm include:

  • Chain transactions,
  • Call-off stock warehouse procedure in cross-border trade, and
  • Conditions for the application of the 0% rate with the right to deduct on account of intra-Community supply of goods (the ICS).

As regards the call-off stock procedure, the bill introduces new regulations and repeals the current ones concerning consignment warehouses. To this end, Chapter 3a, setting out the rules concerning the movement of goods in the call-off stock warehouse procedure within the territory of the state, and Chapter 3b, regarding the movement of goods under the procedure of call-off stock within the territory of another Member State, were added to the VAT Act.

The issue of chain transactions was determined by amending Art. 22(2) and adding subsections 2a-2d to the VAT Act. These regulations are to ensure unified rules for member states of the European Union in respect of determining the so-called ‘movable delivery’, which should minimize the risk of occurrence of double taxation or non-taxation.

The amendments also introduce changes to Art. 42 of the VAT Act concerning the necessary conditions for the application of the 0% rate to intra-Community supply of goods. Upon the entry into force of the above regulations, the requirement for the purchaser to have a valid identification number assigned to him by the Member State other than country in which the dispatch began, as well as the obligation to correctly submit a VAT-EU summary information will constitute a material condition for the application of the exemption with the right to deduct. Furthermore, in order to apply the 0% rate on an ICS, it will be necessary to obtain an identification number from one’s purchaser.

Without any doubt, in terms of chain transactions and call-off stock warehouse procedures, the amendments should be treated as unifying and simplifying the current regulations. On the other hand, taxpayers involved in intra-Community supplies of goods have to take into account the fact that when the amendments come into force they will have to verify their business partners more closely, and this will also involve additional workload.


Natalia Szymocha, Tax Consultant, ATA Tax Sp. z o.o.

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