The results of the International Index of Tax Competitiveness are already there 2021 conducted by Tax Foundation. The report presents countries that have the most and least business-friendly tax systems. Poland was once again placed in a low position in this ranking. The penultimate place for 37 OECD countries are a worrying outcome.
The ranking of the International Tax Competitiveness Index can help potential investors to choose a country where they would like to operate. It measures the quality of the applicable tax system in a given country. The evaluation shall include five important areas. These are:
- corporate taxation,
- taxation of individuals,
- taxation of consumption,
- property taxation,
- rules on taxation of cross-border activities.
In particular, the tax rates applied by the States are taken into account. However, the complexity of numerous preferences and exceptions is also important.
In terms of the tax rates alone, Poland is not the worst. In the case of corporate and natural taxation, Poland ranked fifth and sixth respectively. The Polish tax system appreciates the imposition of relatively high marginal CIT rates. In the case of PIT in favour of Poland, there is a fact of having linear taxation.
A network of double taxation agreements with 85 countries. However, the complexity of the individual provisions has crossed out Poland's chance to take a high place. The number of records for the taxation of legal persons caused the seizure 28 places.
Even worse is when taxation of individuals is taken into account (30 item) or taxation of consumption (37 place).
The tax system has a significant impact on the economic growth of the country. Well designed allows taxpayers to easily calculate and pay their dues and provides funds to finance public expenditure. The complex tax system we face in Poland can discourage taxpayers from productive activity.