Business activity income taxing in Poland

Abstract

Business activity income taxing constitutes the least stable element of the Polish tax system. Income taxing is influenced by the following: organization and legal form of business entity and the kind and size of conducted activity. Corporation taxing is stable enough. This taxation is based on uniform principles for all corporate customers. A tax equality basis is considered there. The most controversial is an amount of cost items which are not recognized as tax deductible business expenses by the tax law. Taxing income from business run by individuals, partnerships and general partnerships is made on different principles than those of corporate customers, because it is regulated by different acts. It leads to a situation, that with reference to different business entities, operating in the same environment and in the same conditions, tax equality basis is not preserved, which can affect tax privileges and possibilities of developing business activity on the competitive market. Changes in taxing income from business activity should lead to standardization of taxation principles for all business entities and to concentration on supporting the entrepreneurship and to guarantee economic stability and shape an appropriate level and structure of tax revenues.