The government has apologised for an error that has left some teachers and soldiers with lower salaries after the introduction of a tax overhaul. It blamed misinterpretation of regulations and promised that the issue would be fixed before February.
A number of tax changes went into force at the start of the year as part of the government’s flagship “Polish Deal” programme, which is meant to leave more money in the pockets of lower earners.
But immediately some teachers and soldiers – who receive wages at the start of the month – began to complain about receiving lower salaries, sometimes by several hundred zloty. University staff have also complained about the reforms lowering their incomes.
Lekcja od nauczycieli w temacie #PolskiŁad.
Zweryfikuj jak najszybciej, czy złożyłeś pracodawcy PIT-2 (jeśli masz prawo). Bez tego twoja zaliczka nie będzie co m-c pomniejszana o 425 zł (1/12 kwoty zmniejszającej podatek). W 2021 to było 43 zł więc nie było to tak wazne. pic.twitter.com/LCGYvW2uAQ
— Małgorzata Samborska (@SamborskaM) January 4, 2022
In response, the education minister, Przemysław Czarnek, initially called on people to “stop [spreading] misinformation regarding the alleged negative impact of the Polish Deal on teachers’ salaries”. But soon after, the government’s spokesman, Piotr Müller, admitted to the problems.
“There could have been a miscalculation of the income tax advance in several places,” said Müller on Wednesday. He apologised for the “legislative inaccuracies” that had “allowed for such an interpretation” during the transitional period into the new tax regime.
“We will make some adjustments to the ordinance” to iron out the problem, pledged Müller, who also said that there would be “additional training and information activities” to help with implementation of the new tax regulations.
The government pledged that those with incorrectly calculated salaries would receive reimbursements in February, when the overpaid amount in January will be offset.
Deputy finance minister Jan Sarnowski cited a number of areas for potential miscalculations, including “unnecessary applications” to give up a newly introduced middle-class tax relief, or failing to submit the PIT-2 tax filing form, in which taxpayers request that the tax-free threshold allowance is applied to their earnings from the start of the year.
He warned that it was possible that “tax advances currently paid will be higher than those paid in the previous year” but that the total amount, following tax returns at the end of the year, would be lower.
The government has maintained that its tax reforms will create a more progressive system by cutting levies on lower earners. On Wednesday, ministers reiterated that all regular taxpayers earning up to 12,800 zloty (€2,794) per month should not see any decrease in their net pay.
Teachers are currently paid between 3,538 zloty and 6,510 zloty before tax, depending on their qualifications. The government estimates that at the lower end of this scale teachers will save most, 144 zloty per month, following the tax reforms, while at the higher end the changes would be “neutral”.
But the opposition has seized on the opportunity to criticise the government’s flagship programme. “Teachers are already feeling what the so-called ‘Polish Deal’ means to their pockets,” said Michał Kobosko, chairman of the Polska 2050 party.
The rector of Adam Mickiewicz University in Poznań, Bogumiła Kaniewska, has also spoken out, saying that the lower salaries experienced by some academic staff were “not a mistake, nor a result of the defect in the calculation system”.
“It is a consequence of the new tax regulations in force from 1 January,” said the professor in a letter published on Tuesday. She said the changes would not affect lower-paid academic staff, such as administrative employees, but would hit academic teachers.
Moreover, some retirees who receive monthly pensions between 5,000 and 13,600 zloty will receive lower benefits, reports Gazeta Wyborcza. The Poznań university’s employees who receive pensions, disability benefits or have more than one job will see their tax advance raised by 425 zloty relative to past years.
The tax reforms included in the “Polish Deal” package, were unveiled by the ruling coalition in May and approved by the government in September, before coming into force at the start of 2022.
Among the key changes was an increase in the income-tax-free allowance to 30,000 zloty (€6,550), almost ten times higher than the previous 3,091 zloty. The annual earnings threshold for entering the bracket for the highest income tax rate of 32% has been raised to 120,000 zloty (€26,200).
At the same time, the government has abolished a relief allowing some taxpayers to deduct a majority of their health insurance contributions from their tax payments. It has introduced a compensatory mechanism – the so-called middle class relief – for those earning between 5,701 and 11,141 zloty per month.
The government estimates that 8 million people, which is two thirds of those employed in Poland, will see their net salaries increase as a result of the reforms. Some business leaders, however, have argued that plans to make health contributions non-tax-deductible will hurt the middle class.
Main image credit: Bartosz Banka / Agencja Gazeta
Maria Wilczek is deputy editor of Notes from Poland. She is a regular writer for The Times, The Economist and Al Jazeera English, and has also featured in Foreign Policy, Politico Europe, The Spectator and Gazeta Wyborcza.
