June 25, 2019 / 4:18 PM / a month ago

Poland announces huge tax break for young earners

WARSAW (Reuters) - Poland’s governing Law and Justice (PiS) party agreed a more than 12-fold rise in the tax-free allowance for wage earners aged under 26, extending a programme of new social benefits in the run-up to autumn parliamentary elections.

The threshold is being raised from August to 85,528 zlotys ($22,883) a year from a maximum of 6,600 zlotys, benefiting around 2 million workers, the finance ministry said on Tuesday.

“We want Poland to be a good place to work where young people’s perspectives are improving,” Prime Minister Mateusz Morawiecki said.

Izabela Leszczyna, a lawmaker for the main opposition Civic Platform party, labelled the reform a “primitive handout” whose timing was linked to the election, due to be held in October or November.

It would not benefit those “who are truly in a difficult situation,” she added.

A government spokesman did not immediately respond to telephone and text messages requesting comment.

The PiS, which took office in 2015 and whose democratic credentials EU authorities have called into question over reforms it has implemented to Poland’s media and judiciary, is on course to be re-elected.

According to a June survey from state pollster CBOS, PiS has 44% support, while Civic Platform stands at 22%. Anti-PiS groupings combined lost to PiS with a margin of less than one percentage point in May’s European Parliament elections, however.

Proportionally, those aged between 18 and 29 make up the smallest share of the PiS voter base.

So far this year the party has also granted families an extra 500 zlotys payout for their first child and handouts to retirees.

Under a long-term financial plan, the government has signalled it may increase excise tax on alcohol and cigarettes in 2020, and impose a digital tax on internet firms.

($1 = 3.7376 zlotys)

Reporting by Joanna Plucinska, Marcin Goclowski and Pawel Florkiewicz; editing by John Stonestreet

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