SLIM VAT - what is the new VAT project?


The new draft law on VAT raises positive emotions. According to the representatives of the Ministry of Finance, SLIM VAT is a tax that is easy to use and adapted to the local specificity of the country. The implementation of another technological solution and e-administration services related to VAT assumes a reduction in the obligations incumbent on taxpayers.

The idea to amend the Act of March 11, 2004 on tax on goods and services emerged as a result of the verification of the existing regulations. The implementation of the changes is aimed at adjusting the applicable legal norms to the environment of small and medium-sized enterprises in which entrepreneurs must operate. The conclusion of the conducted verification are decisions to work on modernization and simplification of the regulations on VAT settlements.

SLIM VAT pillars

The proposed amendment is based on four basic areas in which the change is to be implemented. First of all, the modification of the regulations is to concern solutions to simplify the settlement of value added tax by taxpayers - the SLIM VAT package (Simple Local And Modern VAT), ideas that clarify and supplement some legal structures in VAT and changes in the scope of the VAT system. travel tax refund.

The SLIM VAT project introduces changes to VAT in four areas:

  • Simple invoicing.
  • Facilitations for exporters.
  • Common exchange rates with income tax.
  • Financial benefits.

Changes to issuing invoices

It is planned to resign from the formal condition of obtaining confirmation of receipt of a correcting invoice by the buyer of the goods or the recipient of the service. Moreover, it is assumed that provisions will be introduced specifying the method of settling corrective invoices "in plus" (increasing the tax base).

Introduction of the electronic document flow TAX ​​FREE

It is assumed that a procedure will be implemented that will concern the circulation of documents in the tax for travelers. The entire procedure will be carried out through the electronic document flow TAX ​​FREE, registered in the national IT system used to handle documents that are the basis for VAT refunds to travelers, on the Platform of Electronic Tax and Customs Services (PUESC).

In detail, taxpayers will be required to keep in electronic form, in the TAX FREE system, records containing data allowing for the correct settlement of tax in the travel tax refund system, in particular data on:

  1. delivery of goods and tax base, amount of output tax, tax rate;
  2. travelers;
  3. confirmation of the export of goods outside the territory of the European Union;
  4. tax return.

Common exchange rates with income tax

The draft act assumes that the amounts used to determine the tax base expressed in a foreign currency may be converted by the taxpayer into zlotys, in accordance with the principles of converting income resulting from the provisions on income tax applicable to that taxpayer for the purposes of settling a given transaction. The taxpayer who chose the conversion rules is obliged to apply them for at least 12 consecutive months from the beginning of the month in which he chose them. The described possibility allows, therefore, to minimize the time to determine the exchange rate for a single transaction, which seems to be very beneficial for the trader. The solution will be introduced on a voluntary basis.

Other benefits of planned changes

The proposed amendment also introduces a number of changes that are jointly defined as financial benefits for the taxpayer. Among other things, one of such benefits is the possibility to deduct VAT invoices for the purchase of accommodation services for the purpose of reselling them. Currently (Article 88 (1) (4) of the VAT Act), the reduction in the amount or the refund of the difference in output tax does not apply to accommodation and catering services purchased by the taxpayer, thanks to the anticipated changes, this is to change.However, it is worth noting that the introduced solution does not apply to services purchased by taxpayers for the direct benefit of the tourist (obligatorily settled in the VAT-margin system, including the purchase and resale of tourist packages). The proposed change consists in allowing the deduction of input VAT on accommodation services purchased by taxpayers only for the purpose of reselling them, i.e. after purchasing the service in order to transfer it to the next buyer (i.e. in connection with the so-called re-invoicing of the service)

The changes do not apply to catering services.

Another, though actually a small change, is to increase the limit for unchecked gifts of small value from PLN 10 to PLN 20. In this case, the legislator is of the opinion that the change of the limit is related to the perceived changes in the prices of promotional items. The proposed change will enable better promotion of Polish goods and services both at home and abroad.

Changes also in the export of goods

Slim VAT includes proposals to extend the deadline for the export of goods to maintain the 0% rate when taxing advance payments for the export of goods from 2 to 6 months. The proposed change concerns the provision of Art. 41 sec. 9a of the VAT Act. The proposed solution assumes that receiving the advance payment (in whole or in part) before the delivery of the goods results in the application of the 0% rate for the export of goods in relation to the received advance payment. At the same time, under the condition that the goods will be exported within 6 months (and not, as it is currently the case, within 2 months), counting from the end of the month in which the taxpayer received the advance payment, and within this period, he received a document confirming the export of goods outside the territory European Union. The application of the extension of the goods export period from 2 months to 6 months is satisfactory for taxpayers who receive advance payments for the export of goods.

Clarification of interpretation doubts

The amendment to the act allowed the legislator to clarify or directly dispel doubts that arose in the course of applying tax regulations. For example, the provision regarding the split payment mechanism has been made more precise. "Currently, there is a provision in this respect - the total amount due is the amount referred to in Art. 19 point 2 of the Act of March 6, 2018 - Entrepreneurs' Law."There were opinions of some experts that such a provision means that the obligation to use the split payment mechanism applies only to invoices with a gross value of exactly PLN 15,000.

In order to eliminate any doubts, it is proposed to refer directly to invoices with a gross value exceeding PLN 15,000 or its equivalent, in cases where the amounts on the invoice are expressed in a foreign currency. In addition, it is proposed to indicate the rules that will be applied to determine whether the gross value of the invoice exceeds the limit of PLN 15,000 if the amounts indicated on the invoices are expressed in a foreign currency, i.e. to indicate the rules for converting these amounts ".1

Legal basis

Act of March 11, 2004 on tax on goods and services, Journal of Laws 2020.106, i.e. along with the draft act amending the act on tax on goods and services and the act - banking law, list UD118.

1 Justification for the draft act amending the act on tax on goods and services and the act - banking law, list UD118.

Material prepared by the team of "Tak Prawnik".

The owner of the brand "Tak Prawnik" is BZ Group Sp. z o.o.