Rockstars of Tax
Interview with Agnieszka Mitoraj and Rafal Sadowski from Deloitte Poland
As global multinational companies are reconsidering their supply chains in the post-COVID world, Poland has been increasing in importance as Europe’s manufacturing hub. Due to complex legislation, there are many tax aspects that must be considered when operating in the country. To sort things out, Deloitte Poland Transfer Pricing Partners Agnieszka Mitoraj and Rafal Sadowski spent a couple of days in Helsinki to meet Finnish companies. They also freed up some time to be interviewed by Jari Ahonen from Deloitte Finland about the latest developments in Poland.
12 April 2023
JARI: Agnieszka and Rafal, welcome to Finland!
AGNIESZCKA & RAFAL: Thanks for the invitation! It has been nice to be here and meet with so many Finnish companies.
JARI: Have you been to Finland before?
AGNIESZCKA: No, this is my first time.
RAFAL: For me as well.
JARI: Really? If I remember correctly, you must have been advising Finnish companies for at least 15 years. Had I known this, we would have invited you in June, when the weather is usually nicer.
AGNIESZKA: Actually, this was a perfect time to meet, since there are many tax compliance matters that we should start working on now to have everything in order before statutory deadlines.
JARI: What are the hot topics at the moment?
AGNIESZKA: Obviously, transfer pricing compliance is keeping companies busy. In Poland, our transfer pricing documentation requirements are generally based on OECD model, so we have CbC reporting, Master File and Local File with Poland specifics. Remember that the approach of the Polish tax authorities is very formal so no exceptions from the regulations are accepted. Calculated from the end of the fiscal year, taxpayers have ten months to prepare the Local File, 11 months to prepare the disclosure form and 12 months to prepare the Master File.
JARI: Have there been any recent changes our clients should be aware of?
AGNIESZKA: One important change has been implemented with respect to transfer pricing reporting – previously we had two separate documents: TPR form and the Statement of the Management Board confirming that related-party transactions are at arm’s length. Since this year and with respect to reporting for 2022 these two documents were merged.
JARI: What does it mean in practice?
AGNIESZKA: It completely changed the way of submitting the TPR form. Still last year any person authorized to submit tax returns was able to make the filing, but this has changed. Now the form must be submitted by one of the board members which connects the personal responsibility of this board member with the content of TPR form and the statement.
JARI: Ok, I see. It looks like we should start preparing for the filings sooner rather than later. What other trends do you see in the market?
RAFAL: An interesting trend we see in Poland is the growing interest to Central/Eastern Europe locations by investors. It is the result of the change in the approach to the supply chains of our clients and the shift towards closer, more near-shoring locations, with fewer transport issues compared to more traditional locations. This, coupled with incentive programs offered by Poland presents an exciting opportunity for our clients.
JARI: Supply chain resilience has been a major topic lately.
RAFAL: Obviously, we need to remember that OECD Pillar 2 is likely to reduce the attractiveness of many of the more traditional incentive types, based on reduction in effective tax rates, but there are other potential options available.
JARI: If you were only allowed to give one piece of advice to the clients in this respect, what would it be?
RAFAL: I believe that for anyone operating in Poland, it is important to understand the compliance focused tax system that we have. Working with a trusted advisor that combines global perspective with local expertise is the most efficient way to thrive in such an environment.
JARI: Agnieszka: you act as the Diversity and Inclusion leader for our Central European Member firm. What does it mean in practice?
AGNIESZKA: It means that we create a space and atmosphere where everyone can feel safe and comfortable in our organization. This means working conditions where we make sure everyone is heard. We have based our strategy on five pillars: gender balance, LGBT and inclusion, mental wellbeing, neurodiversity, and disabilities. Our aim is to adjust our policies and actions to respond to the specific needs of our people.
JARI: Sounds very good! One question I have always wanted to ask from Rafal: why did you choose to become a tax advisor and what did you study?
RAFAL: I am economist by education, so transfer pricing, focused on helping multinational enterprises to set their transactional flows and help them establish arm’s length pricing sounded like an interesting choice in Poland in late 90’s…
JARI: I can relate to that. Very last question: how did you like Käärijä’s Cha Cha Cha we showed you at the office?
RAFAL: It was interesting…
AGNIESZKA: I am in shock [laughing].
RAFAL: I voted for Lordi in 2006, though.
JARI: Well done, Rafal! Thank you both for taking the time for this interview!
AGNIESZKA & RAFAL: Thank you! And thanks also to Veera and Hanna for all the arrangements. See you again!