May 19, 2022

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Inflation in Poland - reduced value-added tax on food.  Liddell and Aldi's comment

Inflation in Poland – reduced value-added tax on food. Liddell and Aldi’s comment

From the beginning of February, a temporary reduction in value-added tax will be applied on food to 0 percent. This is an element of the second version of the so-called anti-inflation shield, which will be dealt with by the Senate after the vote in the House of Representatives. Advertisements on this matter were published by the retail chains Lidl Polska and Aldi.

At the beginning of the week, Prime Minister Mateusz Morawiecki presented the elements of the second edition of the so-called anti-inflation shield. These cuts included zero value-added tax on fertilizers and food, which is currently subject to a 5% rate. The changes will apply from February 1 to the end of July 2022. The law has already been passed in the House of RepresentativesNow the Senate will take care of it. The next Senate meeting is scheduled for January 20-21.

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Reducing VAT on Food – Comment from Liddell and Aldi

The announcement of the announced changes was published by Lidl Polska Network. “From February 1 this year, the legislator reduced the value-added tax rate to 0 percent on all food products that have been subject to a 5 percent value-added tax rate so far. The tax reduction will also apply to products such as garden soil, fertilizers or plant chemicals. Protection.” – The press office of the retail chain noted.

According to Lidl Polska, due to the reduced VAT rate, at least 2,000 will be deducted. products. “Cheap butter, milk, cream, bread, apples, carrots, potatoes … the list of cheaper products thanks to the reduction of the value-added tax rate to 0 percent is very long (…)” – announced the network, adding that “customers expect lower prices as of February 1 of this general”.

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In 2021, the network opened eight hundred facilities in Poland.

Representatives of the Aldi chain, which has 203 stores in our country, commented on the new regulations. And the company announced that it “is not waiting for the invoice and is reducing prices as of January 31.”

“The share of food that is subject to a 5% VAT rate is significant in Aldi stores and consumers are sure to feel the positive effects of the tax cut. In many cases, this change will exceed 5%.” – Presented by network representatives. Consumers will get – as in the case of Lidl ads – nearly 2,000 products at a discount.

Reduction of value-added tax on food – what products?

During Tuesday’s press conference, Prime Minister Morawiki appealed to businessmen to lower the prices of their products. – I appeal to all entrepreneurs who trade in food products to reduce product prices by 5 PLN accordingly – said the head of the government. As evidenced by the reduction of the value-added tax on food to zero, the cost of the state budget is 6-7 billion PLN. According to Prime Minister Morawiecki, PLN 45 will remain in the wallet of the Poles due to the reduction of the value-added tax on food.

The reduced VAT rate to zero is applied to these food products – they are taxed at a rate of 5 percent. – such as meat, fish and their products, dairy products, vegetables and fruits and their products, cereals, products of the grinding industry, preparations of cereals and bakery products, and some beverages, for example containing at least 20% fruit or vegetable juice, milk drinks and so-called milk plants.

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In the case of the means used for agricultural production reduced value-added tax of 8%. To zero is cover fertilizers, plant protection products, garden soils, and agricultural production support products such as soil conditioners, growth stimulants and growing media.

Main image source: stock struggle