Poland slashes taxes to keep young workers in country

August 2, 2019
Wawel Castle Poland by Zespol Wzgórza Wawelskiego via Wikipedia

Poland has many historical sites, such as Wawel Castle in Kraków. But young Poles are more interested in their futures than the past. They have been leaving the country in droves to find work. Polish officials hope a dramatic new tax law will change that emigration pattern. (Photo by Zespol Wzgórza Wawelskiego via Wikipedia Commons)

Donald J. Trump and many of his supporters have been worrying for years about people wanting to come into the United States.

Many European countries also have been pulling up their welcome mats when immigrants approach their borders.

One nation, however, is concerned about the people who are leaving.

Poland fears that young people leaving the country are producing a critical brain drain at a time when the country actually is doing well economically.

To counter those departures, the Polish government has enacted a new law, which took effect Aug. 1, that eliminates income taxes for some earners younger than 26.

Big tax break to keep young Poles at home: Poles age 25 or younger making less than 85,528 Polish zloty (just more than $22,000 U.S. per the Aug. 2 exchange rate) a year now are exempt from the country’s 18 percent income tax.

That’s a great deal, since the average Polish salary stands currently is not quite 60,000 zloty (around $15,500 U.S.) a year.

The government said 2 million people will qualify for the benefit.

That will cost Poland, according to government estimates, around 2 billion zlotys (nearly $516 million U.S.) a year.

Polish officials believe it will be worth it if the tax break, as Prime Minister Mateusz Morawiecki hopes, “prevent[s] a further loss, a bleeding of the population that is especially painful for a nation, a society, when it concerns the young generation.”

Bringing expatriates back, too: In addition to keeping young Poles from leaving, the country hopes the tax law change will persuade those who went elsewhere for work to return.

Morawiecki said that around 1.5 million Poles, that’s almost the population of Warsaw, have emigrated since his country joined the European Union in 2004.

Other estimates put the Polish population outflow at closer to 2 million. The country’s total population is around 38 million.

The United Kingdom has been the most popular destination for Polish migrants since 2004, with almost 1 million now living in the British Isles.

If Poland is successful in getting some of those nationals to move back home, many in the U.K. would be pleased, too. The pace of immigration, particularly from Poland, was cited by many who voted for Brexit, the plan to leave the EU by later this year.

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