Business-friendly amendment to VAT law

2009-11-10

President Lech Kaczynski on 5 November signed off on an amendment to the VAT act that transposes into the Polish legal system three EU directives regarding VAT collection and reporting. According to the government, which drafted the amendment, the changes will simplify VAT rules for companies.
One important change is that VAT on services provided between Member States will now be collected, not in the country where the service originates, but in the country of the customer. Furthermore, the procedure of applying for a VAT refund from another Member State will be simplified: companies will only need to file an electronic application with a Polish tax office, which will forward it to its counterpart in a relevant Member State.
At the same time, companies will be required to submit information about transactions with firms from other Member States on a monthly basis (by the 15^th day of each month) rather than quarterly as now. This latter change is meant to reduce the possibilities of VAT evasion.
Most of the new rules will take effect on 1 January 2010, except changes concerning the place of VAT taxation of services related to culture, art, sports, science, education and entertainment, which will become law a year later.