1 January 2020 was the effective date of the European legislation on a package of quick fixes to VAT treatment of cross-border supplies of goods within the EU.

The new law was enacted as Regulation 2018/1912 (directly applicable in all Member States as of 1 January 2020) and Directive 2018/1910 (which was supposed to have been implemented into national law by 31 December 2019). Poland has not implemented that directive within the prescribed time.

In those circumstances, the Finance Ministry issued a communiqué that taxable persons can elect in the interim period (between 1 January 2020 and enactment of the changes in Polish law) which law they wish to apply, i.e.:

  • the quick fixes directive, or
  • the Polish VAT Act.

What is important is to ensure that the election (Polish vs. EU law) must be consistently applied in all VAT aspects of each transaction concerned.

Even though it has offered a choice, the Finance Ministry recommends that persons involved in EU chain transactions elect to apply the directive. This is intended to prevent differences in the VAT treatment of the same transaction in different EU Member States by various entities in the chain.

To read the communiqué in Polish, you can use the link below:

https://www.gov.pl/web/finanse/implementacja-dyrektywy-20181910-dot-tzw-pakietu-quick-fixes

Also, according to the cabinet legislative schedule, there will be no continuation to the VAT Act amendment proposal dated 11 June 2019 which was originally intended as the vehicle for implementation of Directive 2018/1910. A new change proposal is expected to be issued (schedule item UC 11) but its details are yet to be known.

If this issue pertains to your business and you are interested in our assistance, please contact us.

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