Regime change
The Finance Ministry favors cutting the country's standard value-added tax (VAT) rate from 22 to 18 percent, and reducing the number of items that receive preferential rates.
This is to ensure that the move would not affect the budget.
The preferential rate would also be raised.
A decision on VAT had been expected before Christmas, but a source close to the Ministry said a "political storm" had erupted over the plan.
The government intends to resume talks on the issue in January.
"We have presented three proposals, but we like the three rates of zero, eight and 18 percent the most, because this option gives us the lowest standard rate," Finance Minister Mirosław Gronicki told reporters. Current VAT rates are zero, seven and 22 percent.
Under the new proposals, the zero rate would apply mostly to exports, eight percent would target food products, while most other goods and services would be taxed at the 18 percent standard rate.
Two other proposals call for rates of zero, seven and 19 percent and zero, 10 and 20 percent.
Opposition parties have said the changes could hurt the poorest by raising preferential VAT rates and conseqently the prices of basic products like food and medicine.
Standard VAT rates in the European Union range from 15 percent in Luxembourg and Cyprus to 25 percent in Denmark, Hungary and Sweden.
(L.M., Reuters)
This is to ensure that the move would not affect the budget.
The preferential rate would also be raised.
A decision on VAT had been expected before Christmas, but a source close to the Ministry said a "political storm" had erupted over the plan.
The government intends to resume talks on the issue in January.
"We have presented three proposals, but we like the three rates of zero, eight and 18 percent the most, because this option gives us the lowest standard rate," Finance Minister Mirosław Gronicki told reporters. Current VAT rates are zero, seven and 22 percent.
Under the new proposals, the zero rate would apply mostly to exports, eight percent would target food products, while most other goods and services would be taxed at the 18 percent standard rate.
Two other proposals call for rates of zero, seven and 19 percent and zero, 10 and 20 percent.
Opposition parties have said the changes could hurt the poorest by raising preferential VAT rates and conseqently the prices of basic products like food and medicine.
Standard VAT rates in the European Union range from 15 percent in Luxembourg and Cyprus to 25 percent in Denmark, Hungary and Sweden.
(L.M., Reuters)
