Katowice Special Economic Zone as a winner of FDI Global Free Zones of the Year ranking in Europe and Krakow Special Economic Zone ninth place in the world according to Tholons Top 100 Outsourcing Destinations. Such success two The most famous Special Economic Zones in Poland have become in a sense only a memory.
The government decided that zones in their current shape are obsolete and inadequate to modern market realities. Place fourteen The SEZ has established a single investment area covering the territory of the whole country.
Region-dependent State support
The construction so far has been that certain "privileged" small territories of the country were tax-friendly to investors in the sense that they could count on tax relief. The genesis of this structure was the desire to attract capital, especially foreign. It is bold to say that this initiative has been successful.
The names of some Polish cities have become recognizable in the world. Modern glass buildings began to be built next to the grey blocks. Graduates of various courses gained new opportunities.
However, opinions began to appear that the Special Economic Zones were created in the realities of the economy, which only begins to form after the fall of the Polish People's Republic and therefore do not agree with the current realities of the developed country.
- We don't want to be a montage of Asian screws. We want to create more added value. We need our thought, what is our advantage, taking into account business processes - these words Mateusz Morawiecki summed up the state of affairs and justified the liquidation of Special Economic Zones in the present form.
The whole country has become a single investment area, which makes state support dependent, among other things, on the degree of unemployment in a given district.
10,000,000 PLN or 100,000,000 PLN required investment expenditure
The implementing regulation for the law on the promotion of new investments linked the conditions of state support for business to, among others, the unemployment rate in a given district.
„In the country where the unemployment rate is equal to or lower than 60% the average unemployment rate in the country, the entrepreneur undertakes to pay the eligible investment costs at least 100,000,000 PLN” – read the text of the regulation.
The required investment costs fall to 10,000,000 PLN where unemployment rate is higher than 250% average unemployment rate. This mechanism may be a form of incentive to invest in less developed regions of the country but a negative effect cannot be excluded. Amount 100,000,000 PLN may in some sense be “contrary” to some investors. This in turn can justify the choice of another country (not another county of Poland) for the entire investment.
Potential impact on the economy
The assessment of the new formula of investment incentives could now be premature. Economic impacts are not always easy to predict on the basis of theoretical assumptions.
At the same time, it cannot be agreed that the SEZ's existing formula meant only the assembly of Asian screws. Some Polish cities (especially Kraków) have become the facilities of, for example, American investment banks. This meant that Polish students and graduates performed activities less responsible than the head office in New York, for example, but gained knowledge and experience, which would not be replaced by scientific literature.
source: https://www.forbes.pl/opinie/koniec-specjalnych-stref-ekonomicznych-nowy-plan-rzadu/9b8gsnl
Author: Andrzej Dmowski
Lawyer and Doctor of Legal Sciences of the University of Warsaw. From 2011 one from Managing Partners in Russell Bedford Poland. Previously on the BDO advisory network, as well as Deloitte & Touche. Author of the book “Transfer Prices”, co-author of the commentary “The Corporate Income Tax Act”, author of many publications on tax law.