Next year's income tax rates to remain stable and so may construction VAT

Tax rates next year will remain the same, while several tax breaks will be abolished, the Sejm decided yesterday. Under the provisions of the new bill, Poles will continue to pay 19%, 30%, or 40% tax on their income. Yet they will no longer be allowed to deduct investment in construction of rental apartments. Private school tuition has also been eliminated as a deduction. In exchange, the schools will be granted 100% state subsidies (currently 50%). The tax office will also skim 10% of every lottery jackpot. Under the new bill, retired policemen, soldiers and firemen, like civil pensioners thus far, will have the right to earn zl. 1,300 monthly on top of their pensions. It is, however very unlikely that Value Added Tax (VAT) for construction materials and services will be increased from the present 7%, as the idea is opposed by most representatives. The Sejm Public Finance Commission is to debate on the VAT bill next week. (Rzeczpospolita, pp. A2, B3)