"Polish Order" is the name of a new socio-economic program for Poland, introduced by the government for the post-covid period. The changes he introduces will apply to practically every working resident of the country, and companies will have to adapt to operating in the new conditions - both large, small and sole proprietorships. The agri-food sector and the commercial sector will undoubtedly also feel the impact of the "Polish Deal". In what aspects can changes be expected and what will they bring?

Changes in various aspects

For the agricultural, food and commercial sectors, the "Polish Deal" introduces quite a lot of changes and they will affect various aspects of its operations. We are talking here, for example, about tax issues, the costs of health insurance contributions or the widely announced changes in the agricultural sector, including favorable proposals for family farms. In fact, the new arrangements can have an impact on every related level of production, distribution and consumption. The changes will be felt by everyone: producers, suppliers, owners and employees of stores, and finally - consumers.

Change in tax-free amount

The main change that will undoubtedly affect the sectors in question is the increase in the tax-free amount. It increases to 30 thousand. zlotys, which will exempt persons receiving the minimum wage from tax. This can be felt in those working in some grocery stores or manufacturing centers. Their situation will slightly improve, because the salary they receive will increase by about PLN 140 per month.

The situation is slightly different for the self-employed. While the change proves beneficial for people earning up to 6,000 PLN gross monthly (their net salary will increase from several dozen to several hundred zlotys), people earning over PLN 6,000 Unfortunately, they will lose gross zlotys per month. In the case of entrepreneurs earning more than 10,000 PLN per month, gross annual losses can reach even several thousand zlotys. This is an issue that can certainly affect the costs of services, production and the products themselves, which will ultimately be felt by consumers.

Organizing the tax process

The "Polish Deal" is to introduce new, structured principles of the tax process. This change, in turn, was introduced with larger companies in mind, which are to benefit from the amendment. The new rules will include, for example, simplified transfer pricing settlements for holding companies investing in Poland, exemption from VAT of settlements within the capital group and a guarantee of taxation stability in the first years of investment.

It is worth emphasizing that the currently announced arrangements are not the last ones and the rulers plan to introduce new rules, amendments and programs. An example may be the planned act on employee stock ownership programs. However, this act still arouses emotions. Although the institution of employee shareholding existed before, the opportunities it offered were not attractive due to regulatory and legal barriers.

Changes in the agricultural sector

The president of the ruling Law and Justice party in Poland, Jarosław Kaczyński, announced in May 2021 that changes would be introduced in the agricultural sector. One of them is the bill on the family farm. This law would be a real "revolution" in the agricultural sector. A significant reform is to revolutionize the Polish countryside and cover all family farms operating in Poland.

What are the main goals of the law? First of all, it is organizing and regulating the inheritance and organizational issues of the family farm. Likewise, family farms will be able to gain a lot, as they will be given priority in taking advantage of government support programs. The act is to facilitate the modernization of the Polish countryside and respond to the needs of young farmers who want to adapt their work to modern conditions and current market needs.

Another change is also the planned "Agricultural Code", the purpose of which is to separate small farms from large companies and regulate their activities. Smaller farms are also to benefit from the introduction of Polish food passports. The planned digital inspection system is to enable the identification of food from the moment it is produced in the field until it hits the consumer's table. The whole is to increase the competitiveness of products produced by smaller family farms and to simplify the formalities system.

Food Manufactories - Another Support for Smaller Producers?

One of the announced elements of the Polish order is the network of the so-called food manufactories, which are to further increase the competitiveness of small producers and the position of local products. Food manufactories are simply meant to be a retail outlet for products delivered directly from farms. Provisions are also planned to enable retail sale of agricultural products throughout Poland. In addition, an aid program is planned for the National Center for Agricultural Support, which is to help farmers to adapt to new procedures and take advantage of the opportunities they offer.

Changes in transport and logistics

As part of the "Polish Deal", the government plans to invest in logistics and supply chains, and promote low-emission transport. The aim of extensive activities is to promote Polish agriculture, as well as to strengthen the position of farmers in relation to the recipients of their products.

A positive change that will be felt by agricultural producers will be an even greater return of excise duty on agricultural fuel. So far, the premium for subsidies was PLN 100 per 1 ha, currently it is PLN 110 per 1 ha. And although this is undoubtedly a change of good, it should be asked whether, in the era of high inflation and rising fuel prices, farmers will actually feel it in the wealth of their portfolios.

Will the changes affect the price of food?

The government's announcements sound enthusiastic, talking about revolutionizing the operation of the Polish countryside, benefits for smaller farmers and consumers. However, in the context of the latter, it is primarily about better availability of healthy, native food. And although the implementation of such an assumption is undoubtedly positive, the question of how the "Polish Deal", combined with the inflationary situation, will affect the prices of Polish food and its export, remains open. Practice will certainly show this, and in the coming weeks and months we will see preliminary analyzes and conclusions drawn from them.