Orlen, a major player in Poland’s fuel market, has announced the suspension of its membership in the Polish Oil and Gas Industry Organization (POPiHN). This decision was made in protest against the organization’s involvement in the legislative process regarding a new windfall tax.
POPiHN, which has been advocating for the oil sector for over three decades, counts industry giants like Amic, Aramco Fuels, BP Europe, Circle K, MOL, Shell, and Unimot among its members. The organization also engages in analytical activities and combats illegal fuel trade.
According to sources familiar with the matter, all options, including a complete exit from POPiHN, are being considered by Orlen. The organization did not respond to inquiries regarding Orlen’s suspension or whether it is linked to its recent stance on the new tax.
Tax Controversy
Last week, POPiHN published its position on the proposed windfall tax for the fuel industry, shortly after the government cabinet led by Donald Tusk adopted the project. The organization’s statement was notably critical, describing the proposal as purely fiscal and opposing the idea of addressing budget deficits at the expense of businesses.
The statement cited several grievances regarding the new tax, including claims that it could be unconstitutional. It also criticized a government package meant to shield consumers from rapid price increases at fuel stations following the outbreak of the war in Iran.
While some members of POPiHN endorsed the statement, Orlen’s absence was prominent. The letter addressing the new tax was backed by companies such as Amic, Anwim, which operates the Moya station network, Aramco Fuels Poland, BP Europa, Circle K Polska, MOL Polska, Shell Polska, and Unimot.
New Tax Moves to Senate
The new tax, expected to be paid by the fuel industry this year, has already been approved by the Sejm and is likely to be reviewed by the Senate this week. Afterward, it will be sent to President Karol Nawrocki, who has previously vetoed proposed tax hikes, such as those on excise taxes. Conversely, he signed a law increasing the corporate tax burden for the banking sector.
This windfall tax was intended to address extraordinary profits generated by the industry following the war in Iran, which led to skyrocketing oil prices and increased costs for refined products like diesel.
During discussions about the new tax, the government agreed to reduce the tax rate from 75% to 60%, yet this adjustment did not alleviate concerns within the industry, which believes it will significantly impact businesses and hinder future growth.
The Ministry of Finance estimates that the new tax will generate approximately 4 billion PLN for the budget, with Orlen expected to contribute the majority of this amount.
