Chief Marek Belka:

Taxes could 'weaken' Polish banking system

GMT 17:58 2015 Tuesday ,27 October

Arab Today, arab today Taxes could 'weaken' Polish banking system

Poland's central bank chief Marek Belka
Warsaw - Arab Today

Poland's central bank chief on Tuesday warned that the incoming conservative government's plans to impose new taxes on banks could weaken the EU member's "stable" financial sector.

Marek Belka said the "imprecision and variability" of proposals by the newly elected right-wing Law and Justice (PiS) party for taxes on the banking sector was making it "difficult to foresee the possible consequences".

Introducing new taxes coupled with the possible restructuring of foreign currency loans -- something the PiS said it was considering -- could "significantly weaken financial stability, which is after all the basis of sustainable economic growth," the former Polish premier and finance minister warned, quoted by the Polish PAP news agency.

The PiS has vowed to lower the pension age, introduce generous family benefits, impose taxes on banks and foreign-owned hypermarkets while cutting taxes for small and medium-sized businesses.

The party scored an outright majority in parliament in Sunday's election, meaning it will easily be able to pass tax and public spending reforms.

Critics have also warned these moves could destabilise public finances.

According to Leszek Balcerowicz, the architect of Poland's 1990s transition to free-market economy, promises would cost 52 billion euros (58 billion dollars).

He has also warned that a tax on financial transactions floated by the PiS could put a damper on trade at the Warsaw Stock Exchange.

A quarter century of explosive growth since communism's demise has turned Poland, an EU and NATO member of 38 million people, into central Europe's powerhouse.

According to World Bank figures, its economy is expected to expand by 3.5 percent this year and next.

Joblessness recently dipped below 10 percent but voters fed up with eight years of centrist government, ousted the Civic Platform liberals in the general election.

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