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Local tax policy: How do local governments in Poland shape their revenues?
Corresponding Author(s) : Joanna Rogalska
Humanities & Social Sciences Reviews,
Vol. 11 No. 6 (2023): November
Abstract
Purpose of the study: This study aims to explore how tax rates in surrounding municipalities affect tax decisions in 36 Polish municipalities. It also seeks to understand how local revenues and GDP impact the role of local taxes in funding local governments. Additionally, the study examines the interplay between local tax policies, decentralization, and municipalities' responsibilities, especially considering Poland's significant financial independence.
Methodology: This article examines the existing body of literature relevant to the author's research areas. Relevant materials were chosen, and additional sources were incorporated, with the most significant ones being documented in the bibliography. As a result, an initial evaluation of preexisting information (derived from secondary studies) was employed as a research methodology.
Main findings: The findings of the study indicate that tax rates in neighbouring municipalities do have an impact on local politicians' decisions regarding tax resolutions. The study also reveals that there is a positive correlation between own revenue and GDP, indicating the fiscal importance of local taxes in financing local self-government.
Application of the study: The findings of this study can be applied to inform policymakers and local authorities in Poland on the importance of considering tax rates in neighbouring municipalities when making decisions regarding tax resolutions. This study also highlights the significance of local taxes as a source of revenue for local self-government, particularly in the context of Poland's high degree of financial autonomy.
Originality/Novelty of the study:This study is interesting because it examines the relationship between personal revenue and GDP and how it affects the fiscal significance of local taxes. It also comprehensively examines how tax rates in neighbouring municipalities influence the decisions made by local officials. These findings contribute to a better understanding of the factors influencing local tax policy and revenue diversification in Poland and can potentially inform future reforms aimed at enhancing the fiscal autonomy and effectiveness of local self-government entities in the country.
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- Act of January 12, (1992,) on local taxes and fees, “Journal of Laws” 2019, item 1170, as amended.
- Act of November 13, 2003, on the revenues of local government units, “Journal of Laws” 2020, item 23, as amended, art. 4.
- Csefalvay, Z. (2011). Gated communities for security or prestige? a public choice approach and the case of Budapest. International Journal of Urban and Regional Research, 35(4), 735-752. https://doi.org/10.1111/j.1468-2427.2010.00996.x
- Dziuba, J., & Życzkowska, E. (2021). The importance of municipal tax policy in shaping forest tax revenues in Poland. Ekonomia i Prawo. Economics and Law, 20(1), 91-105. https://doi.org/10.12775/EiP.2021.006
- Felis, P., Rosłaniec, H., & Szlęzak-Matusewicz, J. (2019). Property tax policy of rural and urban-rural municipalities in Poland. Acta Scientiarum Polonorum. Oeconomia, 18(4), 31-39. https://doi.org/10.22630/ASPE.2019.18.4.42
- Sokołowska-Woźniak, D., & Woźniak, D. (2019). Income dispersion in poland. an analysis in years 2005 – 2018 based on individual incomes of polish gmina’s (communes) in nuts 2 and nuts 3 units, JEL, 3(1), 18-29. https://doi.org/10.17721/tppe.2019.38.2
- Swianiewicz, P., & Łukomska, J. (2016). Local TaxCompetition in Poland?. Miscellanea Geographica. Regional Studies on Development, Sciendo, 20(3), 37-43. https://doi.org/10.1515/mgrsd-2016-0018
- Swianiewicz, P., & Łukomska, J. (2017). Is small beautiful? The quasi-experimental analysis of the impact of territorial fragmentation on costs in Polish local governments. Urban Affairs Review, 55(3), 832-855. https://doi.org/10.1177/1078087417744676
- The Act of July 28, (1983), on inheritance and donation tax, “Journal of Laws” 2019, item 1813, as amended.
- The Act of November 15, 9(1984), on agricultural tax, “Journal of Laws” 2020, item 333.
- The Act of November 20, (1998), on lump-sum income tax on certain incomes earned by individuals, “Journal of Laws” 2019, item 43, as amended.
- The Act of October 30, (2002), on forestry tax, “Journal of Laws” 2019, item 888.
- The Act of September 9, (2000), on the tax on civil law transactions, “Journal of Laws” 2020, item 815, as amended.
- Wojtowicz, K., & Hodzic, S. (2021). Relationship between fiscal sustainability and efficiency: evidence from large cities in Poland. Economics & Sociology, 14(3), 163-184. https://doi.org/10.14254/2071-789X.2021/14-3/9
References
Act of January 12, (1992,) on local taxes and fees, “Journal of Laws” 2019, item 1170, as amended.
Act of November 13, 2003, on the revenues of local government units, “Journal of Laws” 2020, item 23, as amended, art. 4.
Csefalvay, Z. (2011). Gated communities for security or prestige? a public choice approach and the case of Budapest. International Journal of Urban and Regional Research, 35(4), 735-752. https://doi.org/10.1111/j.1468-2427.2010.00996.x
Dziuba, J., & Życzkowska, E. (2021). The importance of municipal tax policy in shaping forest tax revenues in Poland. Ekonomia i Prawo. Economics and Law, 20(1), 91-105. https://doi.org/10.12775/EiP.2021.006
Felis, P., Rosłaniec, H., & Szlęzak-Matusewicz, J. (2019). Property tax policy of rural and urban-rural municipalities in Poland. Acta Scientiarum Polonorum. Oeconomia, 18(4), 31-39. https://doi.org/10.22630/ASPE.2019.18.4.42
Sokołowska-Woźniak, D., & Woźniak, D. (2019). Income dispersion in poland. an analysis in years 2005 – 2018 based on individual incomes of polish gmina’s (communes) in nuts 2 and nuts 3 units, JEL, 3(1), 18-29. https://doi.org/10.17721/tppe.2019.38.2
Swianiewicz, P., & Łukomska, J. (2016). Local TaxCompetition in Poland?. Miscellanea Geographica. Regional Studies on Development, Sciendo, 20(3), 37-43. https://doi.org/10.1515/mgrsd-2016-0018
Swianiewicz, P., & Łukomska, J. (2017). Is small beautiful? The quasi-experimental analysis of the impact of territorial fragmentation on costs in Polish local governments. Urban Affairs Review, 55(3), 832-855. https://doi.org/10.1177/1078087417744676
The Act of July 28, (1983), on inheritance and donation tax, “Journal of Laws” 2019, item 1813, as amended.
The Act of November 15, 9(1984), on agricultural tax, “Journal of Laws” 2020, item 333.
The Act of November 20, (1998), on lump-sum income tax on certain incomes earned by individuals, “Journal of Laws” 2019, item 43, as amended.
The Act of October 30, (2002), on forestry tax, “Journal of Laws” 2019, item 888.
The Act of September 9, (2000), on the tax on civil law transactions, “Journal of Laws” 2020, item 815, as amended.
Wojtowicz, K., & Hodzic, S. (2021). Relationship between fiscal sustainability and efficiency: evidence from large cities in Poland. Economics & Sociology, 14(3), 163-184. https://doi.org/10.14254/2071-789X.2021/14-3/9