Fin Min would like beneficiaries of fund programs to pay VAT in advance

The Finance Ministry has come up with a new proposition that all enterprises that take advantage of Phare and ISPA fund programs, have to instantly pay the entire VAT on all services that are executed using these funds, and afterward solicit for a partial return. Such a decision will force entrepreneurs and local governments which want to commence investments, to pay a much greater deal of money before realizing an investment. The Office of the Committee for European Integration (UKIE) has suspended the registry of all projects which are a part of the Phare and ISPA programs, until the completion of works over the ordinance regulating the issue. Currently the part of the project which is supported by the fund is VAT free. The new proposition of the Finance Ministry has been widely criticized by UKIE and by the Economy and Labor Ministry. Entrepreneurs and local governments fear that the new regulation will lead to an increase in bureaucracy, without any additional benefits. (Rzeczpospolita, p. B1) A.K.