Inconsistency with EU creates loophole in tax on imports of software

An inconsistency in the regulations regarding taxes on information technology hardware and services has allowed companies to avoid paying taxes on some of the software they are using. As long as the software is imported, and if the software development is done by a foreign company with its headquarters outside Poland, then VAT should be paid on the Polish border only for the IT hardware, and not on any software that may already be installed in it. The loophole has arisen from an inconsistency between Polish and European Union tax policies. In EU countries, such transactions are subject to tax on goods and services, or VAT, in the country where the recipient is based. (Rzeczpospolita, p.B2) M.T.