Prime Minister Mateusz Morawiecki has announced the extension of the zero VAT rate on food. “From the beginning, we developed measures to reduce the effects of inflation. Our protective shield was primarily zero VAT on food. We are continuing this shield, as it has been so far, at least for the first half of 2023”, said the Prime Minister at Tuesday’s press conference.

“Last year we put the brake on these accelerated prices of very high inflation. Since the end of last year and the beginning of this year, we have managed to mitigate inflation by reducing the VAT rate and excise duty on many product groups”, said Morawiecki.

The information was also confirmed by Finance Minister Magdalena Rzeczkowska.  She announced that the regulation introducing a zero VAT rate on food will be published later this week

“The budget to be implemented this and next year is a budget of security for Poles”, said the head of the Ministry of Finance.

Mateusz Morawiecki, referring to economists’ calculations, said that the government’s actions related to the reduction of VAT rates and excise duty on many products had lowered the peak of inflation by 3 to 4%. According to the head of government, this means that if today the inflation level is between 17%, without the government’s reaction it would be between 21 and 22%.

“Inflation cannot be defeated overnight. We can already see the light in the tunnel, we can see that according to many analysts, inflation has a chance to be in a strong downward trend from the middle of the second quarter of next year”, he added.

Morawiecki said that the shield to protect the budget of Poles was primarily the zero VAT on food. Announcing that it would be maintained for at least the first half of 2023, he indicated that this cost around PLN 8 billion and counting dynamically maybe even above PLN 8 billion.

“This cost will have to be accepted by the budget of the Polish state in order to ease product prices for Poles”, the Prime Minister said.

Arkadiusz Słomczyński