Poland becomes single special economic zone
Poland is about to become a single special economic zone – replacing an array of “special economic zones” offering tax incentives.
From June 30, investors will be able to apply for preferential taxes without having to move cross-country.
The changes update the rules on new investments in Poland, adapting them to today’s economic situation, which is very different to the one two decades ago. By emphasising development and making life easier for small and medium enterprises (SMEs), the change echoes the Polish government’s broader economic policy.
Right now, there are 14 special economic zones, covering 0.08% of Poland’s territory. The zones were established in 1994 to stimulate investment and reduce unemployment. Since then, over PLN 107 billion has been invested in them.
Almost 70% of the capital came from six countries: Poland, Germany, the Netherlands, the US, Luxembourg and Italy. Automotive companies accounted for one-quarter of investment. In total, over 350,000 people were employed in the zones, according to the Ministry of Entrepreneurship and Technology.
After the change, investors can apply for preferential taxes based on the type and location of the investment, and the quality of jobs created. Tax exemptions will be granted for up to 15 years. The changes are expected to benefit SMEs, by making the rules more accessible to them.
“This is a new model, changing the instrument from the 1990s. The new economic situation, record-low unemployment and the creation of industry 4.0 mean that today the aim is to attract technologically advanced investments, encompassing R&D centres, including to places where they are lacking,” said Minister of Entrepreneurship and Technology Jadwiga Emilewicz.
The change also marks a shift in the government’s emphasis. “We are moving the weight of assessment to qualitative, rather than quantitative, criteria,” said Emilewicz. Rather than simply maximising investment, companies will be encouraged to support long-term development.