Today, the Ministry of Finance published a draft law introducing a new public levy – advertising duty.
The new duty is in line with the global trend of introducing broadly understood “digital taxes”.
The Ministry of Finance informs that the purpose of introducing new regulations is to obtain additional funds to prevent long-term health, economic and social effects of the COVID-19 pandemic.
Further, the ministry indicates that the contributions will strengthen the finances of: the National Health Fund, the National Monument Protection Fund and a new earmarked fund to finance projects related to changes in the digital space, culture and national heritage.
The draft provides for the introduction of two contributions:
- duty for conventional advertising and
- duty for internet advertising.
Duty for conventional advertising
The entities obliged to pay the new duty will be media service providers, broadcasters, cinema operators, entities placing advertisements on an external medium and publishers.
Importantly, the duty would be due after exceeding revenues (excluding VAT) for the provision of advertising services in the amount of PLN 1 million (PLN 15 million in the case of press advertising).
The duty rates are to be different, depending on: the amount of income (progression), the form of advertising and its subject. Their level will vary from 2% to 15%.
Duty for internet advertising
The entities obliged to pay this duty will be service providers who provide online advertising in Poland, provided that the following conditions are jointly met:
- the revenues of the service provider / capital group exceeded the global equivalent of EUR 750 million, where
- revenues from the provision of internet advertising in Poland exceeded EUR 5 million in the year.
The duty rate is to be 5%.
The commented provisions would enter into force in July 2021. Currently, the ministry is awaiting comments under the so-called pre-consultation.
The ministry estimates that the tax revenues in 2022 may amount to approximately PLN 800 million.
In practice, the proposed changes may have a significant impact on the economy due to the fact that the new levy may be transferred, as a cost, to entities commissioning advertising services.
The full name of the project is the draft act on additional revenues of the National Health Fund, the National Monument Protection Fund and the creation of the Fund for Support for Culture and National Heritage in the Media Area.