July 2, 2019 / 11:00 AM / 20 days ago

Polish cabinet postpones talks on retail tax due to PM absence

WARSAW (Reuters) - The Polish government has postponed discussions about a bill reintroducing retail tax, citing the prime minister’s absence, the cabinet spokesman said on Tuesday.

FILE PHOTO: Poland's Prime Minister Mateusz Morawiecki arrives for the European Union leaders summit in Brussels, Belgium, June 20, 2019. REUTERS/Yves Herman

The cabinet was set to deal with the proposed measure at its weekly meeting on Tuesday but the topic was dropped from the agenda as Prime Minister Mateusz Morawiecki was away attending talks on European Union jobs in Brussels.

“The government plans to proceed with this bill and will probably return (to it) at the next (cabinet) meeting,” the government spokesman said.

The government decided to reintroduce the levy after the General Court of the European Union in May overruled a 2017 finding by the European Commission that it was illegal under EU law to tax larger retailers more heavily than smaller ones.

Imposing the tax was one of the eurosceptic Law and Justice (PiS) party’s main election promises when it came to power in 2015, part of a raft of measures designed to fund generous social spending pledges.

Under the scheme, retailers with monthly revenue of over 170 million zlotys (£36 million) were to be taxed more heavily than smaller counterparts.

The measure was shelved two years ago when the EU executive ruled that it constituted illegal state aid to smaller firms.

The EU court overruled that decision, ruling that differing tax rates depending on the size of companies were permissible.

The government now plans for the tax to take effect from Sept. 1, four months earlier than planned.

It will affect big retail companies including Jeronimo Martins’ (JMT.LS) Polish business, and local retailers CCC (CCCP.WA), LPP (LPPP.WA) and Dino Polska (DNP.WA).

Reporting by Agnieszka Barteczko; Editing by Mark Heinrich

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