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Inheritance and gift tax. Senate – budget and public finance committee for rejection of the bill

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The Senate Budget and Public Finance Committee voted on Tuesday to reject the deregulation bill. The legislation includes changes to the inheritance and gift tax that are controversial. There was information that if the regulations came into force in the form adopted by the Sejm, the donations announced in order to finance expensive therapies for patients would be at risk.

Parliament at the end of January supported the so-called deregulation act, which amends several acts. The legislation has now gone to the Senate. During Tuesday’s meeting of the Finance Budget Committee, Ryszard Świlski, Senator of the Civic Coalition, requested the bill to be rejected in its entirety. In his opinion, “this is crap, not a law.”

The same request was made by Adam Szejnfeld from KO during the meeting of the Senate Committee on National Economy and Innovation. He said the bill was “disappointing in both scope and quality” with so many amendments it made no sense.

The budget committee accepted the motion to reject the act in its entirety, while in the case of the national economy and innovation committee, the motion to reject it did not pass. The committee did not pass the motion to adopt the act without amendments.

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PiS amendments to the law

Both during the meeting of the budget committee and the economy committee, senators PIS proposed an amendment to the law. It was about clarifying the provisions of the Act on inheritance tax and donations, so that it does not affect charitable fundraising in any way. However, these amendments were not voted on.

The introduction of such a change was announced by the Prime Minister last week Mateusz Morawiecki, who in an interview with interia.pl said that he would not allow the new regulations to “in any way affect the issues of collecting funds for charity and initiatives of this type”. He assured that he had instructed the Ministry of Finance to immediately specify the issue of collecting funds for charity.

“We’re back to what it was before.” It must be honestly said that the overzealousness of some officials, but also perhaps goodwill – they wanted to seal something, change something – led to this confusion that no longer exists – Morawiecki then said during a press conference in Dąbrówka near Warsaw.

Ministry of Finance informed that it was working on clarifying the provisions of the Inheritance and Donation Tax Act, and the head of the Standing Committee of the Council of Ministers, Łukasz Schreiber, declared that the PiS club would submit an amendment to the Senate deleting the new provisions concerning, among others, collection for charity.

As “Dziennik Gazeta Prawna” wrote, if the law enters into force in the form adopted by the lower house, then drop-offs announced in order to finance expensive therapies for patients will be at risk. “From July 1 this year, the one who receives donations from many strangers for an amount exceeding PLN 54,180 within five years will pay inheritance and donation tax. This will also apply to donations made on popular crowdfunding portals, e.g. for the reconstruction house destroyed by fire, specialist surgery or expensive treatment.

Deregulation Act

During Tuesday’s Senate committee meetings, speakers included: representatives of the Association of Polish Cities, the Union of Polish Metropolises and various organizations associating, among others, development companies. They pointed out that the act, increasing tax-free amount from inheritances and donations, limits the revenues to the budgets of local governments, and also reduces the so-called biologically active area in new housing estates and also increases the availability of firearms.

The Act provides that the acquisition of ownership of things and property rights with a pure value exceeding PLN 36,120 per person or PLN 108,360 per person over a period of 5 years will be exempt from inheritance and donation tax – if the purchaser is a person included in the first tax group .

On the other hand, in the case of a buyer included in the second tax group, the acquisition of ownership of things and property rights worth PLN 27,090 from one person and PLN 81,270 in the case of acquisition from several people will be taxable. If the buyer is included in the third tax group, then the limits will be PLN 18,060 for one person and PLN 54,180 for many people. The 5-year periods that are taken into account will be counted from July 1, 2023.

Currently, from October 13, 2022, the tax-free amounts are: PLN 10,434 in the first tax group, PLN 7,878 in the second tax group and PLN 5,308 in the third tax group.

The Act also introduces an amendment to the Code of Administrative Procedure, according to which the decision issued in the first instance, the justification of which the authority withdrew from because the party’s request was fully taken into account, is final. The Act also amends the Code of Civil Procedure, Geodetic and Cartographic Law and the Code of Petty Offenses.

The act is to enter into force 14 days after its promulgation, with the exception of certain provisions whose effective date is different.

Main photo source: Shutterstock

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