Polish Parliament Approves Corporate Income Tax Hike for Banks

On October 17, 2025, Poland's parliament approved a significant increase in the corporate income tax (CIT) for banks, raising the rate from 19% to 30% starting in 2026, with a planned reduction to 23% by 2028. This legislative move, supported by the ruling coalition, aims to address perceived inequities stemming from high bank profits during a period of elevated interest rates. The finance ministry has framed the tax increase as a measure of "social justice," asserting that banks should contribute more during times of excessive profits.

Notes from Poland

The Polish finance ministry has pointed out that the profits of Polish banks have consistently exceeded the EU average, particularly benefiting from a high-interest rate environment that peaked at 5.7% in 2022. The ministry argues that the additional tax revenue is necessary to address Poland's budget deficit, projected at 271.7 billion zloty (6.5% of GDP) for the upcoming year. The tax reform is expected to generate approximately 6.6 billion zloty (€472 million) in 2026, decreasing to 4.7 billion zloty in 2027.

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The banking industry has expressed strong opposition to the proposed tax hike, arguing that it could undermine their ability to support economic growth. Adam Marciniak, CEO of VeloBank, stated that reduced profits would negatively impact Polish citizens' pensions and savings. Additionally, a legal opinion from the Polish Bank Association (ZBP) contends that the tax increase violates constitutional guarantees of equality before the law.

Notes from Poland

Deputy Finance Minister Jaroslaw Neneman defended the tax increase, highlighting that banks operate under a unique business model that exempts them from VAT, unlike other sectors. Civic Platform MP Dorota Marek emphasized that the tax is not intended to impose a permanent burden on banks but to ensure their participation in financing state security during economic crises. The bill passed with 238 votes in favor, primarily from the ruling coalition, while 187 votes opposed it, mainly from the right-wing opposition.

Notes from Poland

The legislation now moves to the upper house, the Senate, which can delay but not block it, before reaching President Karol Nawrocki. Nawrocki, who has previously expressed opposition to tax increases, may veto the bill. However, sources suggest he might ultimately approve it, given the context of banks reporting record profits.

Notes from Poland

While the government projects significant revenue from the tax increase, critics argue that the actual impact on the banking sector and the broader economy remains uncertain. There is also a divergence of opinion regarding the constitutionality of the tax hike, with legal experts divided on its implications.

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• “Social justice principles require that in situations of excessive profits resulting from macroeconomic and geopolitical conditions, entities generating them should contribute to a greater extent to the costs associated with such a situation,” — Polish Finance Ministry

Notes from Poland

• “Any reduction in profits indirectly affects Poles, as it affects their pensions and savings,” — Adam Marciniak, CEO of VeloBank

Notes from Poland

• “It’s not about placing a permanent burden on the banking sector, but about involving it in solidarity in financing the state’s security during the crisis,” — Dorota Marek, MP

Notes from Poland

This tax reform represents a pivotal moment in Poland's fiscal policy, balancing the need for increased revenue against the potential repercussions for the banking sector and the economy at large.

Poland introduces tax reform/Abolishes income taxes for families with two children