Property tax rates in 2021

We already know the maximum real estate tax rates in 2021. According to the Announcement of the Minister of Finance of July 23, 2020, the maximum rates of the annual real estate tax for the next year will be:

A. Lands:

1. PLN 0.99 per 1 sq. m. of land related to running a business,
2. PLN 4.99 per 1 ha of land under stagnant surface waters or flowing surface waters of lakes and artificial reservoirs,
3. PLN 0.52 per 1 sq. m. of other land, including land used for paid statutory public benefit activity by public benefit organizations,
4. PLN 3.28 per 1 sq. m. of undeveloped land covered by the revitalization area and located in the areas for which the local spatial development plan provides for housing, service or mixed use development covering only these types of development, if from the date of entry into force of this plan 4 years elapsed and the construction was not completed in this time in accordance with the provisions of the construction law.

2. Buildings:

1. PLN 0.85 per sq. m. of usable floor space in residential buildings,
2. PLN 24.84 per sq. m. of usable floor space of buildings related to business activities and residential buildings or their parts used for business activities,
3. PLN 11.62 per sq. m of usable floor space of buildings used for business activity in the field of trade in certified seed,
4. PLN 5.06 per sq. m. of usable floor space in buildings related to the provision of health services within the meaning of the provisions on medical activity, taken over by entities providing these services,
5. PLN 8.37 per 1 m2 of usable floor space of other buildings, including buildings used for payable statutory public benefit activity by public benefit organizations.

It is worth recalling that, in accordance with the applicable regulations, the maximum rates of the property tax for a land and a building applicable in a given tax year change annually to the next tax year to the extent corresponding to the consumer price index in the period of the first half of the year in which the rates change in relation to the same period of the previous year. However, specific rates applicable in a given commune are determined by the commune council by way of a resolution.

On the other hand, it has remain unchanged the rules for taxing of structures that are taxed at a maximum of 2% of their initial value constituting the basis for calculating depreciation (with certain exceptions).

Certainly, many municipalities in Poland will take advantage of the possibility of raising tax rates in order to improve their financial situation and increase budget revenues depleted due to the COVID-19 epidemic. On the other hand, the expected increases will hit mainly the owners of buildings used for business activities the most, as well as tenants of commercial and warehouse space under triple-net agreements, who will be obliged to cover the increased tax rates as part of service charges.