This article is a part of Poland Unpacked. Weekly intelligence for decision-makers
Work is under way at the Ministry of Digital Affairs on a model for a digital services tax. The stated objective is to “level the playing field between global players and European and Polish businesses.” Put plainly, the aim is to tax the activities – based on consolidated revenues – of global giants operating in Poland’s digital market. As the ministry recently announced, the levy would apply to companies with global revenues exceeding EUR 750 million. In an ideal scenario, these funds would be used “on the one hand to support the development of Polish technologies and innovation, and on the other to support the creation of high-quality media content.”
“What matters most to us is to compel international corporations to pay taxes fairly, without at the same time penalizing honest companies that already contribute to the budget. From our perspective, this objective is best achieved by opting for a low, 3% digital tax rate and by introducing mechanisms that protect firms which actually pay the corporate income tax due in Poland. These funds should be directed toward the development of Poland’s technology sector and toward supporting the creation of quality media, which have been weakened by Big Tech’s takeover of the advertising market,” declared Krzysztof Gawkowski, Deputy Prime Minister and Minister of Digital Affairs.
The issue of a digital services tax has been raised for years. It is far from straightforward: looming in the background are political and economic relations with the United States, investments by Big Tech in Poland actively promoted by successive governments, and the strong – indeed, in many respects dominant – position of global technology giants.
A fight for “elementary financial fairness”
“The Ministry of Digital Affairs is acting in line with the adopted plan. In the government’s second year in office, Minister Krzysztof Gawkowski announced the implementation of the campaign pledges with which the Left entered the governing coalition. Many of these were included in the Digital State program, among them the introduction of a digital tax. Under the original assumptions, it was to apply to entities with global revenues exceeding EUR 1 billion, providing targeted advertising services and transferring user data. The proceeds from the tax were to fund the development of domestic technologies through the Digital Technologies Fund,” recalls Piotr Mieczkowski, a member of the management board of the National Chamber of Commerce for Electronics and Telecommunications (KIGEiT).
The Ministry is drawing on an expert study commissioned from the Instrat Foundation (Taxation of Digital Activity: An Expert Analysis of Introducing a Digital Tax in Poland). The analysis presents, among other things, tax models operating in countries such as Spain and France, and outlines variants of a digital tax that could be introduced in Poland.
“The proposed variants of the digital tax largely reflect the original assumptions. What is new, however, is the proposal to level the conditions of tax competition and to introduce a corporate income tax shield that would reward entities already paying taxes in Poland. This solution is neutral and should protect us from tensions with allies, particularly the United States. It is difficult to accept a situation in which, for example, Wirtualna Polska pays a higher corporate income tax than global technology giants. This is simply a matter of elementary financial fairness,” Piotr Mieczkowski emphasizes.
How the levy is used will be decisive
In the view of the KIGEiT representative, a digital services tax could be a rational solution – provided it genuinely helps boost investment in domestic technologies, research and development, and mitigates the negative effects of large platforms’ operations, such as declining content quality, the spread of disinformation, or mental-health problems among children.
“What will be crucial, however, is guaranteeing that the funds raised are earmarked for clearly defined purposes. Otherwise, they will merely be used to plug the budget deficit. Effective oversight of the fund will be just as important, as experience with the broadband fund or the justice fund shows that public money is sometimes spent in ways that diverge from its original purpose,” Piotr Mieczkowski adds.
“It is important that the proceeds from this tax be allocated, for example, to the digitization of public services, cybersecurity, or support for R&D. Otherwise, it will simply become yet another fiscal levy,” confirms Przemysław Marcol, a member of the management board of Digitree Group.
Protecting local SMEs and consumers is essential
When discussing the design of a digital tax, several issues come into play, including tax fairness, financing the digital transition, and preserving economic competitiveness. At stake is Big Tech’s contribution to the costs of the ecosystem in which it generates profits.
“The rules are crucial, however: a moderate rate (2–3%) combined with a high threshold for global and domestic revenues – for example, aligned with EU or OECD solutions – would allow the burden to be focused exclusively on the largest players, taxing only the giants. At the same time, a clear safeguard for SMEs is needed: excluding sellers that use marketplaces and minimizing the risk of indirect burdens being passed on to domestic entities,” emphasizes Przemysław Marcol.
He adds that price monitoring (for example, by the Office of Competition and Consumer Protection, UOKiK) would be necessary, along with a ban on automatically passing a ‘digital tax surcharge’ on to Polish customers.
Expert's perspective
The cost of a digital tax passed on to consumers
Experience from other countries shows that the burden of new regulations rarely falls solely on technology giants. The OECD points out that, in practice, costs are often passed on to advertisers and end users. In France, following the introduction of a similar levy, online advertising prices rose by 2–3%. In Spain, Amazon increased fees for sellers by 3%. Google, too, has been intensifying cost pressure on advertisers.
Meanwhile, marketing in 2025 no longer fits neatly into a stable framework. The classic structure built on three pillars – organic traffic, paid campaigns, and owned channels – is increasingly destabilized by rising costs, constant changes in SEO, and the challenges of building a recognizable brand. Maintaining balance today requires greater integration and deliberate investment in specific sales channels. Without sound data analytics, companies will lose their way and face ever higher customer acquisition costs.
Global mechanisms prove difficult to implement
Taxing the digital economy is one of the major challenges facing modern tax systems.
“Poland, like many other European Union countries, has attempted to introduce its own digital tax – the first drafts appeared as early as 2019. The primary aim was to tax technology giants which, thanks to the global nature of their operations, are able to minimize their tax burdens across individual jurisdictions. In Poland, the digital tax remains at the design stage. By contrast, in countries such as Italy, Spain, Austria, Hungary, and Turkey it is already in force, at rates ranging from 2% to 7.5%,” notes Bartosz Ulczycki, senior lawyer at DGTL Kibil Piecuch i Wspólnicy.
In Poland, however, legislative work was put on hold in anticipation of an international solution.
That mechanism is meant to be so-called Pillar One – an OECD- and G20-agreed reform that provides for new rules on allocating a portion of the profits of the largest digital groups to the countries where the users of their services are actually located. The problem is that work on this international solution has dragged on, while the fiscal gap and the competitive imbalance vis-à-vis Polish companies remain a reality. Local businesses pay full taxes in Poland, whereas global digital corporations often report profits in low-CIT jurisdictions. Such asymmetry fuels a justified sense of unfairness and undermines the competitiveness of Polish firms, Bartosz Ulczycki emphasizes.
Good to know
Effective and fair legal safeguards
From a legal perspective, it is crucial that the design of a digital tax:
- be proportionate and non-discriminatory toward EU entities;
- precisely define the revenue threshold so that it covers only the largest global conglomerates;
- take into account the principles of international tax law, including double taxation treaties.
We can – but do not have to – remain a passive observer
In his view, Poland should pursue a dual-track approach: participate in OECD initiatives and global-level work, while also maintaining legislative readiness to introduce a domestic digital tax should international reform once again stall. Any such levy should be designed with precision, so as not to create unintended barriers for smaller e-commerce businesses or start-ups.
“A digital tax is not a panacea, but its introduction – whether at the global or national level – is a necessary step toward greater tax fairness and a more level playing field. Poland cannot afford to remain a passive observer in this debate, which is crucial to the future of the economy,” Bartosz Ulczycki emphasizes.
Business perspective
Reinvesting tax proceeds in research and development
Of course, the key will be striking the right balance, so that the tax mechanism does not stifle innovation. It is worth considering scenarios in which the proceeds are reinvested in research, the development of AI, and programs supporting the digital transition. This would be a step toward a modern, pro-European digital economy – one in which domestic start-ups not only emerge, but also have a real chance to scale and compete globally.
As a Polish start-up operating at the intersection of AI and mental health, we know that without European boldness we will not catch up with Silicon Valley or Chinese players. And yet we have the talent, the minds, and the drive to compete for the top spot with the biggest players.
Key Takeaways
- The Ministry of Digital Affairs is working on a model for a digital services tax. “What matters most to us is to compel international corporations to pay taxes fairly, without penalizing honest companies that already contribute to the budget. From our perspective, this objective is best achieved by setting a low, 3% digital tax rate,” declared Krzysztof Gawkowski, Minister of Digital Affairs.
- According to Piotr Mieczkowski, a member of the management board of KIGEiT, it will be crucial to ensure that the funds raised from the tax are allocated to clearly defined purposes, including the support of new technologies and research. Otherwise, the money would simply be used to plug the budget deficit.
- Market representatives are concerned whether, if a digital tax is introduced, the interests of local small and medium-sized enterprises as well as consumers will be adequately protected.