Tax customs & excise

Not every tax postponement constitutes state aid

In the landmark ruling of the Provincial Administrative Court in Warsaw of April 22, 2021 (ruling sign. III SA/Wa 2288/20), the court stated that the deferral of the tax payment deadline granted due to the negative effects of the COVID-19 pandemic was not a public aid for the Company, and is not subject to limits of public aid resulting from EU regulations.

The company questioned the fiscal office’s position which recognized the deferral of the deadline for payment of tax arrears in the amount of 1.7 million granted to the company for de minimis aid, i.e. public aid. In particular, the tax office authority argued that the mere waiver of the prolongation fee by the authority meant that the deferral was of a state aid nature (as it was not carried out under market conditions).. It should be noted that in accordance with EU regulations, de minimis aid is subject to a three-year limit of up to EUR 200,000, not only for a specific entity, but all entities related to it.

The Provincial Administrative Court in Warsaw upheld the company’, stating that the granted deferral did not constitute state aid, including de minimis aid. First of all, in the opinion of the Court, the aid provided in connection with the COVID-19 pandemic has its direct source in the acts, the so-called anti-crisis shields, which do not provide for the imposition of prolongation fees in such a case, therefore the authority had no other option but not to impose such a fee. At the same time, the Court emphasized that the reason for granting the postponement to the Company was force majeure, regardless of the Company’s plans and its ability to manage and profit from its operations. Thus, the granted aid should not qualify as aid subject to the abovementioned limitations. The judgment is not final, but it is an important indication for taxpayers about the possible direction of the jurisprudence in this regard (the pandemic is still in force), and may induce the tax authorities to change their approach

Author team leader DKP Legal Magdalena Napierała
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