“Inflation appeared in Poland along with the COVID-19 pandemic, Gazprom’s price manipulations and the European Union's irresponsible climate policy. These are its three primary causes”, stressed PM Morawiecki. He also explained that by no means is the Polish government sitting back and burying its head in the sand. It does all it can to keep the prices lower and fight the raging inflation.

Government Anti-Inflation Shield 2.0 to bring Poles more savings

After lowering VAT as part of the first Shield, the time has come for further beneficial solutions! The key features of the Government Anti-Inflation Shield 2.0 will apply from 1 February to 31 July 2022 and include such things as:

• reduction of VAT on fuel from 23% to 8%,
• reduction of VAT on natural gas from 8% to 0%,
• reduction of VAT on basic foodstuffs to 0%,
• reduced 5% VAT rate on electricity to remain in effect for longer,
• reduction of VAT on system heat to 5%,
• reduction of VAT on natural gas from 8% to 0%.

Government Anti-Inflation Shield 2.0 to enter into force from 1 February – read on to learn more

• Reduction of VAT on fuel to 8%

The December reduction of excise duty limited the concerning rise in fuel prices. Starting from February 1, the VAT rate will be reduced from 23% to 8%. This will lead to a further reduction in fuel prices – up to as many as several dozen groszy per litre, bringing significant fuel savings to Polish citizens.

• 0% VAT on basic foodstuffs

Rising food prices are among the most severe effects of inflation. Therefore, we have decided to lower the VAT rate on basic foodstuffs to 0%. This will allow an average family to save about PLN 45 per month.

• 0% VAT on gas

Thanks to the reduction in the VAT rate from 23% to 8% applicable since 1 January, as well as another VAT cut from 8% to 0% in effect since 1 February, Polish households will be less affected by price increases than families in most European Union countries.

• Reduced 5% VAT rate on electricity to remain in effect for longer

Today, the CO2 emission fee accounts for more than 50% of the price of electricity. This is the real cost of the European Union's irresponsible, dogmatic climate policy.

Thanks to the changes made, we are mitigating inflation’s impact on electricity costs. The reduced 5% VAT rate on electricity will apply until 31 July 2022.

• Reduction of VAT on system heat to 5%

Starting from 1 January 2022, the solutions introduced under the Anti-Inflation Shield have brought a reduction in VAT on system heat from 23 to 8%. Further steps in this regard consist in reducing the VAT rate from 8% to 5% starting from 1 February 2022. The solution is addressed to virtually every Polish citizen. It applies both to flats within housing cooperatives, as well as communities, and single-family houses connected to the district heating networks.

• 0% VAT on fertilisers

Fertiliser prices are a major contributor to agricultural production expenses. Apart from fuel and electricity tax cuts, the complete waiver of VAT on agricultural fertilisers is bound to bring relief to Polish food producers.

• Lower gas bills thanks to gas tariff changes

Since 1 January 2022, special gas tariffs have been introduced for households that are part of multi-unit cooperative and housing community buildings, as well as hospitals, schools, kindergartens, nurseries and cultural institutions. Thanks to this, both Polish citizens and major public institutions will pay lower bills.

First Government Anti-Inflation Shield

The increase in the cost of electricity and basic food products has already been limited by the first Anti-Inflation Shield introduced in December 2021. Its solutions included such things as:

• inflation allowance for households,
• waiver of excise duty on electricity,
• reducing VAT on electricity from 23% to 5%,
• reduction of VAT on natural gas from 23% to 8%,
• lowering fuel prices by reducing excise duty as far as possible,
• reduction of VAT on system heat (provided by district heating networks) from 23% to 8%.

Together with the reductions under the first edition, the further VAT cuts brought by the second Anti-Inflation Shield will bring Poles savings totalling nearly PLN 25 billion.

Inflation allowance to support nearly 7 million Polish households

Part of the Government Anti-Inflation Shield, the inflation allowance is designed to offset the rise in gas, electricity and food prices, with nearly 7 million Polish households expected to be covered by this measure. This is real financial support for the Polish people and nearly PLN 4 billion has been allocated to this purpose.

To learn more about the inflation allowance and other benefits brought to Polish families under the Anti-Inflation Shield, please visit chronimyrodziny.gov.pl.