Poland’s Ministry of Finance has responded to a cadastral tax proposal, citing constitutional concerns and implementation challenges.
Property Tax vs. Cadastral Tax
Poland currently has a property tax based on surface area, with rates set by municipalities. A cadastral tax, used in countries like Spain, France, and Germany, is based on market value. There are ongoing discussions in Poland about introducing a cadastral tax due to concerns about the fairness of the current system.
The current property tax has been criticized as unfair, with those owning small premium apartments in large cities paying minimal taxes while those with larger properties in poor condition pay higher amounts.
Petition for a Cadastral Tax
A petition was submitted to Prime Minister Donald Tusk, asking for the introduction of a cadastral tax on third or fourth apartments. The petitioner argued this would make housing more affordable for young people and families.
The petition stated that many individuals in Poland own multiple investment properties, driving up prices and blocking access for those who genuinely need housing. The author claimed a cadastral tax would free up apartments for people who need them.
Ministry of Finance. Constitutional Concerns
In response, the Ministry of Finance explained that a cadastral tax on third or fourth apartments would mean applying two different tax regimes to properties with the same characteristics based on how many properties a taxpayer owns.
The Ministry noted that such a solution raises constitutional concerns regarding the principle of equality before the law, as it would create a dual system where properties are taxed differently based on ownership quantity.
Cadastral Tax. Need for a National System
The Ministry highlighted that implementing such a tax would require creating and maintaining a nationwide information system with property values and regular updates due to changing prices.
The costs of creating and maintaining such a system could be disproportionately high compared to the tax revenue generated from a cadastral tax on third or fourth apartments.
Cadastral Tax and the President
President Karol Nawrocki is opposed to introducing a cadastral tax, stating during the election campaign that he would fight to include a ban on such a tax in the constitution.
