The Ministry of Finance wants to Limit Linear PIT (Personal Income Tax)

The Ministry of Finance is looking for a way to limit the right to use the 19% linear PIT (Personal Income Tax) rate by entrepreneurs who bear no economic risk. According to the ministry, they are entrepreneurs who work for one entity, issue one invoice per month and are prohibited from cooperating with other entities.

The deputy minister of finance said that the ministry is working on a so-called “Entrepreneur test” which would allow to determine who is the real entrepreneur and who only benefits from preferential taxation and lower ZUS (Social Insurance Institution) contributions.

For now, no details are known about the ‘entrepreneur test’ being developed by the ministry, but at this stage it may raise doubts and questions. How does this concept fit into economic freedom? What would be the impact of changing the tax qualification of income on tax settlements for previous years?

We will keep you updated on the progress of work in this area.

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