5% flat tax VAT in gastronomy. Launching the Citizens Initiative

Civic initiative “Individual sales rate – 5% VAT in gastronomy was launched in May. Currently, 8% is paid for meals served in gastronomic establishments. Tax, while products such as coffee, tea, water or cubes are charged Ice or 23 percent alcohol Sławomir Grzyb, General Secretary of the IGGP, in an interview with “Puls Biznesu” draws attention to the complexity of the system in the case of leveling dishes in practice.

“VAT on pizza, for example, is 8%, but if you add shrimp to it, we really have to pay 23%. We want it to be 5%. On everything except alcohol.”

We have already heard at the Ministry of Finance that we can become competitors to retail, but it should be noted that our reality is fundamentally different. We provide catering services, and prices in this industry are much higher than in retail, ”he emphasizes.

High risk industry

As a result of recent relief operations, the temporary rate for food purchases has been reduced to 0%. 5 percent Sławomir Grzyb claims that gastronomy has not changed at all.

While restaurant owners bought food at 5% and sold it at 8%, they paid 3% to the tax office. Now, after the change, they’re paying 8 percent, so we only lost the temporary reduction of VAT,” he explains.

Banks do not want to give loans to entrepreneurs because the industry is considered to be very risky. We have no liquidity and dependencies are increasing. Gas and energy prices are rising, and there is a shortage of employees because it is not profitable for them and because they are afraid of the spread of new epidemics. We do not have financial liquidity and the arrears are increasing. Reducing VAT will allow us to increase employee wages, increase employee turnover and at the same time save more money for the budget, and above all, we can reduce prices in the card. The Ministry of Finance calculated the value-added tax reduction to 5 percent. This is a loss to the budget of PLN 1.47 billion annually. The question remains, who will lose and who will win? On reducing the value-added tax rate to 5%. The guest, the employee and the gastronome will benefit ”- he says.

“We hit a wall”

The IGGP decided to introduce a civil bill because it feels it has exhausted all other avenues to get the bill. “We’ve come to the wall,” Grzyb says.

The union consisted of a parliamentary bill and had the support of Agnieszka Ścigaj, the current minister without portfolio in the government of Mateusz Morawiecki, and 36 other MPs. “We also organized a debate in the Senate in September 2022, where we had the support of the PO deputies, but later it turned out that they were indecisive,” says the IGGP secretary.

In January 2023, the association engaged a spokesperson for small and medium-sized businesses, Adam Abramovich, who, together with the unions, went to the Ministry of Finance. The talks again proved unsuccessful. “The talks turned out to be ineffective, and we heard that we should meet with the prime minister, because the decision depends only on him,” Grzyb recalled.

Morawiecki, in turn, referred the IGGP to the Ministry of Development and Technology. The head of the ministry, Waldemar Buda, was the most willing to talk, and tried to initiate a meeting in the finance ministry, but there was no will on his part.

Start before the holidays?

After this ordeal, the IGGP decided to file a civil bill that would require the collection of 100,000 signatures. “All other means have been exhausted, so we are going on the campaign trail to get deputies to express their views on our project,” Grzeb explains.

To date, 120 buildings have been registered in the group. According to the minister, the speed is “very good”. “We want to start before the holidays. First, we need 1,000 signatures to present the bill to the Speaker of the House. Collecting them will not be a problem, the issue is to prepare the bill itself, we are looking for a lawyer. From the decision of the House Marshal, we will have 3 months to collect 100,000. Signatures under the project. By then, we hope that at least 500 gastronomic establishments will come forward to collect signatures, ”he says.