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Inflation. Zero VAT on train tickets? Deputy Finance Minister Artur Soboń says “no”, he gave the reason

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The government has not decided to introduce a zero VAT rate on train tickets. A group of deputies asked the Ministry of Finance about the reasons for such a decision. There is a reply from the deputy head of this ministry, Artur Soboń.

An interpellation to the Minister of Finance regarding the introduction of a zero VAT rate on train tickets was submitted by a group of deputies. As they pointed out, the reduction of the VAT rate on train tickets from 8 to 0 percent. will lead to “lower ticket prices without reducing the budgets of companies”.

“Such a solution is currently used in other countries. W Finland all tickets with zero VAT are sold from January 1 to April 30, 2023, regardless of the date of travel (it counts when the ticket was purchased, even if the trip takes place after April 30), and regardless of the distribution channel through which the ticket was purchased purchased,” the statement reads.

Thus – as explained – you will be able to buy tickets cheaper for night trains that will depart even in August, for long-distance trains (running during the day) whose departure is scheduled for June 19 and for regional trains with a planned departure for March 25 . “Zero VAT also covers season tickets, thanks to which you can even buy an annual ticket 10 percent cheaper. This type of solution can be successfully applied in Poland to avoid ticket price increases,” wrote the parliamentarians.

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MEPs asked whether there are plans to introduce a zero VAT rate on tickets.

Deputy Minister of Finance with zero VAT

Deputy Finance Minister Artur Soboń, in response to the interpellation, said that “passenger transport services provided in Poland – rail, road, water, sea, air – are generally subject to a reduced VAT rate of 8 percent.”

“Reducing the VAT rate in Poland for passenger transport from 8 percent to 0 percent would mean a significant loss of state budget revenue” – stressed Soboń. As he explained, “in the current geopolitical and economic situation, the priority is spending on national defense and support for the society struggling with the effects of inflation and the resulting energy crisis war in Ukraine“.

Earlier, the TVN24 correspondent in Brussels, Maciej Sokołowski, reported that Poland could introduce zero VAT on passenger transport. This solution is allowed by the VAT Directive introduced last year. In Annex III attached to it, we will find a list of goods and services for which it is possible to reduce the tax rate. The fifth point is the transport of people.

Compensation for PKP Intercity

At the same time, the deputy finance minister pointed out in response to the interpellation “for support from the state budget of the main carrier servicing long-distance rail passenger transport, i.e. PKP Intercity mentioned in the interpellation”. “In total, in the draft budget act for 2023, PKP Intercity will receive compensation from the state budget in the total amount of approx. PLN 1.8 billion for the provision of passenger rail transport” – informed Artur Soboń.

Last Tuesday, PKP Intercity announced that it was withdrawing from increasing ticket prices. “Base prices for connections in the TLK and IC categories will be on average about 11% lower than those currently in force, and for the EIC and EIP categories – on average by about 15%, thus returning to the previous level from before January 11” – we could read in the message. The new prices will come into effect on March 1, 2023.

Polregio is the most popular carrier

According to the latest available data from the Office of Rail Transport, in 2022, 342.23 million passengers used rail services.

Polregio is a passenger carrier with the largest share in the domestic market. The company transported 25.47 percent. all passengers. In second place was Koleje Mazowieckie, which can boast of a result of 17.26 percent. The last place on the podium was taken by PKP Intercity – 17.23 percent.

Main photo source: Photocon / Shutterstock.com

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