Philips threatens to leave Poland if tax breaks refused

Dutch electronics manufacturer Philips is threatening to move production of TV sets out of Poland, if the government does not agree for Philips' Kwidzyn plant to be included in the Tczew-Zarnowiec Special Economic Zone (SSE). A special inter-ministry commission is to look into Philips' motion on November 20. Philips is the largest investor in the city of Kwidzyn, employing 2,400 people. The city council has already agreed to expand the zone, although Kwidzyn stands to lose money as a result of the decision. Each Polish gmina gets a share of the income tax paid by local businesses. If the Philips plant becomes a part of the zone, the company would be exempt from income tax for the next ten years. However, the company has pledged to reimburse the city and its residents for the potential losses. Last year Philips netted zl. 89 million over revenues of zl. 1.5 billion in Poland. (Puls Biznesu, p.7