Belka's tax to be changed. The Ministry of Finance wants it to be progressive

A few months ago, signatures were collected under a petition to abolish the so-called Beams tax, i.e. the tax on capital gains. Supporters of the elimination of double taxation are likely to lose not only this battle, but the entire war. The tax may be much greater, but not for everyone.

The Ministry of Finance has just announced that although it is planning changes in the capital gains tax, it will not be its liquidation at all. Rather, it is syntax to make it… progressive. For the sake of sweetness, work is also underway on regulatory facilitations for ETFs.

The pandemic did not abolish Belka's tax

Voices on the abolition of capital gains tax returned in times of the coronavirus pandemic. It did not work then, but the idea was revived in times of high low interest rates on deposits and then accelerating inflation. 

The Ministry of Finance did not refer to these proposals, but it suddenly turned out that considerations about changes in the capital gains tax are still ongoing. 

Ministry of Finance: abolition no, changes yes

Katarzyna Szwarc, the plenipotentiary of the Ministry of Finance for Capital Market Development Strategy, said in an interview with Business Insider journalists that a discussion on the progressive tax on capital gains is needed.

- I believe that we should start a discussion whether the capital gains tax should not be progressive in the future. Currently, it is so that Kowalski, who saves several hundred zlotys in the bank and gains on interest, pays the same tax as an investor who invests hundreds of thousands of zlotys, e.g. on the stock exchange. Here is a field for discussion about whether the tax should not be changed and different depending on who pays it and what is investing - emphasizes Katarzyna Szwarc. 

However, he adds that capital gains tax is very low in Poland.

- We have one of the lowest capital gains taxes in Europe. Our 19 percent [initially it was 20% - ed. ed.] is much less than taxation in countries such as Germany, France, Spain, Great Britain, not to mention Denmark, where such a tax is 42 percent. - lists Katarzyna Szwarc, who is a supporter of the progressive rate.

According to her, the tribute to the state would grow with the increase in the amounts that the investor puts up on the capital market or in bank deposits.

How to encourage Poles to capital investments?

The changes will also affect ETFs. Ministry of Finance he sees a big problem in the fact that Poles avoid investing in the financial market. The vast majority is limited to instruments offered by banks - mainly deposits.

And it is hardly surprising, because most people lack specialist knowledge to invest in the stock market, not to mention the Forex market or cryptocurrencies. 

Meanwhile, for the entire market, it would be better if more people started investing financial surpluses, for example in investment funds or ETFs. The latter are to be offered with facilities in the near future. 

- Currently, on the ETF market, we have very unfavorable regulations that make it difficult to offer them to investors. These are barriers that raise financial institutions' costs of creating this type of products or require extensive bureaucracy. We want to remove these barriers and lead to a situation in which ETFs will become an increasingly popular investment instrument on the Polish capital market. The role of the Ministry of Finance is not to force companies to do IPOs or offer ETFs. Our goal is to create such legal and regulatory conditions that there are no barriers to market development on this side - explains Katarzyna Szwarc.