The recent comments by Minister Pełczyńska-Nałęcz have raised eyebrows. The minister stated to reporters that the corporate income tax (CIT) for banks has been increased to 30%. She believes it should be raised further due to the significant liquidity present in the banking sector.
The minister’s assertion prompts an examination of the logic that connects the existing high taxation with the liquidity phenomenon. Despite attempts, I could not find a coherent rationale.
What exactly is this liquidity issue? In short, liquidity refers to a substantial and increasing surplus of funds deposited by customers in banks compared to the loans they have taken out. This situation arises from a faster growth of money in circulation relative to the demand for loans from individual clients, businesses, and institutions. Simply put, Poles are saving more than they are borrowing.
This situation is influenced by several factors. On one hand, Poland benefits significantly from European Union funds, which, when distributed, create deposits for domestic companies and households. On the other hand, the loose fiscal policies of successive governments and a significant deficit in public finances, funded by bond issuance, contribute to this liquidity. Aside from the necessity of increasing spending on defense and improving public services, the deficit largely stems from generous social expenditures that increase both income and spending, as well as household savings (deposits).
For banks, this scenario is less than ideal. Interest and fees from loans are among their primary sources of revenue. Investing in government bonds or similar instruments is far less attractive, as is keeping funds in the National Bank of Poland.
How, then, is the proposed increase in the CIT justified in light of this liquidity? I do not have an answer but would welcome a logically and intellectually coherent explanation.
It is also important to note the scale at which the Polish banking sector contributes to the state budget. From 2023 to 2026, banks are expected to contribute around 115 billion PLN (including CIT, bank tax, personal income tax from employees, and dividends) to the budget. After six months of this year, the sector’s fiscal burdens have risen by over 38% compared to 2025, reaching nearly 16 billion PLN. The effective CIT rate now stands at 36-38%, the highest in the European Union, while the EU average is 21.3%.
Aside from the last year, the profitability and capital ratios of the Polish banking sector, in comparison to the EU as a whole and particularly to our regional neighbors, have appeared quite weak, primarily due to high tax and regulatory costs.
While it is theoretically understood that robust banks are vital for economic development, practical political actions often reveal a different narrative. Regrettably, this seems to be the case.
