WARSAW: Poland’s exports, which are included in calculating gross domestic product (GDP), were overestimated in 2015 and 2014 by as much as 30 billion zlotys ($7.36 billion) each year due to tax scams, Finance Minister Mateusz Morawiecki said.
Morawiecki said the statistics office, which uses official data from the finance ministry to calculate GDP, should revise down the value of GDP for the last two years. A revision could affect GDP growth data for 2016 due to the base effect, as well as data showing the level of Poland’s deficit and debt in relation to GDP.
“These are very simple, empirical, mathematical data,” Morawiecki said. “We estimate today that in one year total fictitious exports of all goods, all sectors may have reached up to 30 billion zlotys.”
“GUS (the Polish statistics office) and Eurostat have received official data from the finance ministry, And these fictitious exports are in the official data” Morawiecki said. Thirty billion zlotys amounts to 1.7 percent of Poland’s 2015 GDP which reached 1,798 billion zlotys. The 2016 annual GDP data is due on Jan. 31, with the first fourth-quarter estimate expected from the statistics office on Feb. 14.
Morawiecki said economic growth in 2016 likely stood at about 3 percent. The ruling Law and Justice (PiS) party has made fighting tax evasion and tax crime part of its key election programme as it needs to finance its far-reaching social spending agenda.
Poland has had so far one of the largest so-called value added tax gaps in the European Union, which estimates the difference between due VAT and actually collected VAT.
One way organised tax criminals have illegally obtained VAT refunds was by providing documents showing goods were exported from Poland, while in fact the goods were sold inside the country, Morawiecki said. He said the VAT scams involved electronic goods such as hard drives and mobile phones. The construction of the VAT tax requires tax authorities to refund VAT when goods are exported.
“How do VAT mafias operate? … Through a chain of firms, which are fictitious and in fact do not conduct any commercial activity, the last or one of the last of these entities moves these goods abroad to claim a tax refund,” he said.
“But what does it mean that it moved the goods abroad when in fact it did not? This means that these exports did not exist” he said. ($1 = 4.0766 zlotys)
