Poland can target at least PLN 7-12 bln in additional VAT receipts, thanks to improved tax collection through methods such as reverse tax or split payments, as well as to big data tools allowing for finding cues on suspicious transactions, deputy PM and Development Minister Mateusz Morawiecki told weekly Do Rzeczy.
“Taking advantage of such mechanisms we can collect [additional] PLN 7-12 bln,” Morawiecki said, without providing time frame for reaching the target.
Proposals on improved tax collection include split VAT payments, reverse VAT and solidary responsibility. As for tax fraud, the minister sees chances for using latest data science tools.
“The key in limiting the scale of VAT fraud is information,” the minister said. “It is possible to use big data tools to pre-select dubious transactions, suspicious firms.”
The approach would not only limit VAT fraud and increase budget revenues, it would also limit the scale of inspections affecting normal, honest taxpayers, the minister indicated.
To fund government’s generous social spending and tax cut offer, Poland may take advantage not only of sectoral taxes and improved tax collections, but also from PLN 9 bln in income from the LTE auction, the minister indicated.
PiS said during the campaign that it can fund the bulk of its spending promises on improved VAT collection and a new VAT law has been drafted to fight tax fraud. Officials have claimed that a new mechanism will take time to gain momentum and institutional changes introduced in 2016 would cause this process to accelerate in 2017 and beyond.
Last week Morawiecki said Poland could realistically boost its VAT receipts by PLN 10-20 bln within the next two to three years.