Combining special economic zone permits
Until the end of 2014, tax authorities considered that businesses operating in a special economic zone under several permits could keep one set of accounting records for zone income and calculate the exemption for all income from that zone together, without allocating it separately to each permit. This allowed state-aid limits to be used chronologically.
In 2015, this approach changed radically: authorities began asserting that zone businesses must separately record income and losses
for each permit. Adverse rulings followed, including amendments on the authorities' own initiative to previously favourable decisions, for example the Minister of Finance's ruling of 8 December 2015, DD10.8221.199.2015.MZB.
What does the case law say?
Because the authorities' change of approach is relatively recent, no settled administrative court case law has yet emerged. However, judgments of the Regional Administrative Courts in Rzeszów, I SA/Rz 1035/15, and Wrocław, I SA/Wr 1830/15 and I SA/Wr 70/16, indicate that a zone permit merely provides the legal basis for operating there, not the method of recording income or losses. Existing legislation requires separate accounts only for exempt zone activities and activities taxed under general rules. No provision requires separate records for each investment project under separate permits, especially as the resulting income is ultimately assessed together.
These favourable judgments are, however, few and not final. Until the Supreme Administrative Court resolves the issue, the risk associated with the current practice of combining zone permits is difficult to assess.
More on special economic zone permits and other tax aspects of zone activities:
