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2.5 million: that is the average annual number of control activities undertaken by the tax administration in 2020–2024. The amount established through these activities in 2024 alone was PLN 19.05 billion, while all National Revenue Administration expenditure on collection, inspections and enforcement totalled PLN 9.86 billion, of which as much as 76.8% represented control activity costs.
These figures illustrate the scale of tax administration activity and encourage the search for solutions reducing tax disputes and streamlining recovery of public-law receivables. The Ministry of Finance has proposed a new institution: a tax settlement intended to be simple, inexpensive and beneficial to taxpayers and the State Treasury alike.
Tax settlement — what is the new institution proposed by the Ministry of Finance in the bill amending the Tax Ordinance and the National Revenue Administration Act?
The tax settlement institution was proposed by the Ministry of Finance in the bill amending the Tax Ordinance and the National Revenue Administration Act, bill number UDER110.
The solution is intended to be entirely voluntary and allow a definitive end to a tax dispute between a taxpayer or remitter and the tax administration concerning a tax liability whose payment deadline has passed.
For the taxpayer, concluding a settlement is to provide a guarantee of immunity from punishment for late tax payment and a way to reduce accrued late-payment interest and obtain easier repayment terms , such as deferral or instalments.
The tax authority would gain greater certainty of full repayment of the arrears covered by the settlement, since the amount of tax due is not to be subject to the proposed tax settlement, without further control or creditor actions, such as initiating a tax or customs and tax inspection and subsequent tax proceedings.
Finally, the settlement is to benefit both parties through no need to continue the dispute within its scope, particularly before administrative courts , which generates costs and additional burdens for everyone involved.
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Tax settlement — when will it enter into force and will it be used to resolve disputes with the tax authorities?
The Ministry of Finance’s proposed tax settlement is currently only an idea undergoing extensive consultation and review.
We therefore do not know whether it will actually become a real tool. The plan is nevertheless for tax settlement provisions to enter into force from 2028.
Even if that happens, the actual value and usefulness of this solution remain uncertain.
The current bill provides no explicit guarantees concerning confidentiality of pre-settlement discussions. It is easy to imagine a taxpayer applying for a settlement supplying the competent authority with specific information and circumstances that could later be used if no settlement is ultimately concluded, unless such guarantees are added to the act.
Since concluding a settlement is to remain within the authority’s administrative discretion, meaning it can simply refuse, this may limit taxpayers’ interest in using the institution.
Perhaps these issues will be improved in later versions of the bill, and tax settlements will become genuinely useful and often advantageous for Polish entrepreneurs rather than an instrument raising significant practical doubts and therefore rarely used.
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Summary
What is a tax settlement? A new solution proposed by the Ministry of Finance in amendments to the Tax Ordinance
A tax settlement is a solution proposed by the Ministry of Finance in the bill amending the Tax Ordinance and the National Revenue Administration Act.
It is intended to reduce disputes between taxpayers and tax authorities concerning unpaid tax liabilities.
For taxpayers, concluding a settlement is to bring immunity from punishment, lower late-payment interest and access to easier repayment terms.
At present, however, we do not know whether it will enter into force, although planned for 2028, or be widely used, given the controversies, particularly concerning confidentiality.
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