attorney Igor Bąkowski
Bakowski Law Firm, Warsaw, Poland
Importing goods to Poland
Most goods are in free circulation between EU member states and they can be easily moved without customs controls or charges.
There are exceptions in the case of certain sensitive items, such as tobacco, weaponry, agricultural products, surveillance and goods dictated by quantitative restrictions.
All EU member states subscribe to the common trade policy toward imports from third countries.
No import licenses are generally necessary within the EU, but the Union does have quantitative restrictions in position to oversee certain goods being imported from certain countries. Some goods may be liable to tariff quotas (for example from Hong Kong).
The Polish Ministry of Economy issues import permits and concessions and also regulates quotas. However, other Polish ministries have special jurisdiction over products such as: tobacco (Ministry of Agriculture); permits related to air, sea or road transport (Ministry of Transportation); or natural resources (Ministry of Environmental Protection).
In most cases, before respective ministry grants import permission on a product, the product must be reviewed and recommended for import into Poland by one or more inspectorates or technical associations, depending on the nature of the product.
Some products, once imported (like those that can affect consumer health) also require registration.
There are restrictions the import of certain goods, including pirate or counterfeit items, chemical products, genetically-modified organisms (GMO), and live animals and animal products.
Poland has an official “import list”, which includes goods for which licenses are required, their code numbers, applicable restrictions, and the agency that is issuing the relevant license. The list also indicates whether the license is required under Polish or EU law. The license may be required from a number of official bodies, including the Ministry of Development’s Department of Trade and Services or Department of Sensitive Goods Trading and Technical Security, or the Agricultural Market Agency External Trade Office.
Importing goods into Poland from outside the European Union
Customs clearance of the imported goods
Importing goods to Poland from countries that are not EU member states requires customs clearance.
This requires the preparation of a customs declaration together with presentation of the necessary documentation, payment of customs duties and taxes owed on the import of the goods.
The amount of duty and tax owed must generally be paid within 10 days after acceptance of the customs declaration by the customs authority. Until then, if security for the payment is not provided (for example by providing a bank guarantee), the customs authority will not release the goods to the importer.
The Single Administrative Document (“SAD”)
The official model for written declarations to customs is the Single Administrative Document (“SAD”), which describes goods and their movement around the World. This is essential for trade outside the EU, or of non-EU goods.
Once goods are brought into the EU customs territory, they are subject to customs supervision until customs formalities are completed, and are then covered by a Summary Declaration which is filed by either the person who brought the goods into the customs territory, any person who assumes responsibility for carriage of the goods following entry, or the person in whose name they are acting.
This SAD serves as the EU importer’s declaration, and encompasses both customs duties and VAT.
It is valid in all EU member states, and in members of the European Free Trade Association, or EFTA (the EU plus Norway, Iceland, Switzerland and Liechtenstein).
The Economic Operator Registration and Identification (EORI) number
All companies established outside of the EU are required to have an Economic Operator Registration and Identification (EORI) number if they want to lodge a customs declaration or an entry / exit summary declaration.
This must be formally requested from the Polish authorities.
Once a company has received an EORI number, it can be used for exports to any EU member state, and the owner can request Authorized Economic Operator (AEO) status, which can give quicker access to certain simplified customs procedures.
VAT tax on imported goods
Import is treated under Polish tax law as an activity subject to VAT tax.
The basic VAT rate is 23% (other VAT tax rates are also discussed in this information).
The VAT tax obligation arises:
- at the time the customs debt arises;
- if the goods are covered by the procedure of processing under customs control, at the time the goods enter this procedure;
- in other instances, upon introduction of the goods into a free zone or free warehouse, or when compensation fees become due, if such fees are charged for introducing the goods into the free zone or free warehouse.
The basis for taxation is the customs value plus the duty owed, and in a situation where the subject of the import is goods subject to excise tax (Pol.: “akcyza”), the customs value plus duty and excise tax. The tax basis also includes fees and other amounts the customs authorities are required to collect for import of the goods, as well as additional costs such as the costs of packaging, commissions (excluding purchasing commissions), transport and insurance, if not already included in the customs value.
The tax assessed in the customs declaration, as deductible input VAT, will generally constitute a basis for reducing the output VAT in the taxpayer’s VAT declaration.
VAT payers on import of goods are required to calculate and report in the customs declaration the amount of tax, reflecting the applicable rates.
The VAT Act provides for the possibility of non-cash settlement of import tax in the tax declaration. A basic condition for exercising this option is to make a customs declaration (for the procedure of release for free circulation) using the simplified customs procedure pursuant to the Community Customs Code. This procedure generally allows a customs declaration to be made away from the location of the customs authority. In order to use the simplified procedure allowing cash-free settlement of VAT on import of goods, it is necessary to obtain a special permit from the customs authorities. Obtaining such a permit is subject to a number of strict requirements, including a positive audit from the customs chamber for the importer or exporter’s location. Such permits are granted to importers and exporters who are recognized by the customs authorities due to the scale of the customs operations they conduct. Therefore, in practice, an importer or exporter seeking to use this procedure must undergo a reference period when its imports or exports of goods may be analysed by the customs authorities.
The law also provides for the possibility to use this procedure when the goods being imported are included in the simplified procedure by an entity other than the importer and the other entity has been appointed by the importer as its indirect representative within the meaning of the customs regulations.
In commercial practice, the indirect representative is usually a customs agency. For the importer, it may be beneficial to enter into cooperation with a customs agency that holds a permit to use the simplified procedure and holds a certificate as an Authorized Economic Operator issued in Poland by the director of the customs chamber on the basis of the Community Customs Code.
Customs duties
The factors influencing the amount of customs duty include the customs value, tariff classification and the origin of the goods.
Customs value
The customs value is the basis for calculation of duty. It generally comprises the price paid or due for the goods as well as the costs of transportation and insurance.
If any additional costs (apart from the value of the goods) were included in the purchase price, they are not added again to the customs value. In that case, however, the importer should be prepared to provide an explanation to the customs authority upon request, with evidence supporting the importer’s position.
If the customs value does not include certain costs incurred by the purchaser, they should be indicated separately in import invoices or invoiced separately. These costs will be a tax cost but will not be an element of the customs value. To determine precisely which costs could be excluded from the customs value, it is necessary to conduct a detailed analysis of the specific elements of the price of the imported goods.
Tariff classification
Poland adheres to the General Agreement on Tariffs and Trade (GATT) and tariffs are based on the Harmonised System.
Polish customs regulations comply with the European Union’s European-wide directives.
The majority of goods are subject to tariffs rates of up to 30 per cent, although tariffs on some luxury items are more than 100 per cent.
The tariff classification essential for customs purposes is the classification of the goods in accordance with the Combined Nomenclature (CN) set forth in the Common Customs Tariff Regulation, containing a description of the goods together with an 8-digit code assigned to that type of goods pursuant to the CN statistical system.
To identify goods even more specifically, a 9th and 10th digit were added to create the TARIC system, which is necessary to fully complete a customs declaration. Assignment of the TARIC code to the imported goods requires specialized knowledge on tariff classification, including familiarity with the classification rules, the annotations to the Combined Nomenclature, and analysis of the applicable regulations and classification rulings.
Proper tariff classification of the goods under the CN system is crucial for determining the correct amount of customs duty. There is an individual rate of duty assigned to each CN or TARIC code, so an incorrect determination of the tariff classification may result in underpayment or overpayment of duty. In the case of underpayment this may generate additional negative consequences because of understatement of amounts payable to the State Treasury.
Binding Tariff Information
An important institution in the system of customs law is Binding Tariff Information, which is an administrative decision, issued upon request of an interested party, in which the director of the customs chamber issues a binding predetermination that goods will be assigned to a specific CN or TARIC code.
Origin of the goods
The origin of the goods means the determined political affiliation of the goods with a specific country or group of countries. This results in awarding special (preferential) treatment to goods from certain countries, or regulation of their importation through imposition of additional fees or restrictions. Goods may also be said to be of “ordinary” origin, referred to in customs regulations as a non-preferential origin.
The rules for determining preferential origin are usually found in agreements between countries which seek to introduce preferential rules for trade in line with standard solutions. The tariffs established in such agreements are preferential compared to the tariffs included in the Common Customs Tariff Regulation, which sets forth rates of duty for goods of non-preferential (ordinary) origin.
Non-tariff barriers
Import licensing is required for a limited range of products, these include:
- military items
- radioactive materials
- explosives
- arms and munitions
- highly flammable materials
- goods subject to quota, temporary capital imports and products coming under international agreements requiring bilateral settlements.
Import licenses are issued by the Minister of Economy.
Import quotas
Import quotas are established for certain products.
Annual tariff quotas are established for grains and meat, depending on the demand and supply situation.
A range of products is prohibited for reasons relating to the protection of the natural environment, national security, public order, human, plant and animal health.
Foreign exchange control is administered by the Monetary Policy Council (at the central bank) in consultation with the Minister of Finance.
Special certificates
Some products require certification before a declaration of conformity can be issued. Depending on the nature of the goods, a veterinary health certificate and/or a certificate of origin (for concessionary customs rates, if applicable) may also be required. Products containing genetically modified organisms require special approvals.
Restrictions and directives under EU law
When looking to importing goods to Poland the following may also be important:
- the EU Battery Directive – restricting the sale of batteries and accumulators that contain mercury or cadmium, and by promoting a high level of collection and recycling;
- Registration, Evaluation and Authorization and Restriction of Chemicals (REACH) – applicable to all chemicals manufactured or imported into the EU in quantities exceeding one metric ton;
- Waste Electrical and Electronic Equipment (WEEE) Directive – requiring exporters to register relevant products with a national WEEE authority or arrange for this to be done by a local partner;
- Restriction on Hazardous Substances (RoHS) – imposing restrictions on the use of certain chemicals in electrical and electronic equipment;
- EU Cosmetics Directive – governing consumer safety.
There are also strict regulations over agricultural and rural development, and fisheries.
Carbon Border Adjustment Mechanism (CBAM)
On 1 October 2023 the Carbon Border Adjustment Mechanism (CBAM) regulation is expected to enter into force.
This regulation is aimed at equating the situation of producers manufacturing goods in the EU (where restrictions on reducing greenhouse gas emissions are already in force) with producers transferring production to third countries in order to reduce their costs.
The mechanism will initially apply only to certain goods from the following list:
- cement,
- iron and steel,
- aluminium,
- fertilisers,
2023 is the beginning of the transitional period that will last until the end of 2025. During this period importers of the abovementioned goods are obliged to report greenhouse gas emissions (GHG) embedded in their imports (it only applies to direct emissions and no payment is required).
Once the full CBAM system is to become operational (expected on 1 January 2026), the importers will be compelled to purchase certificates at a cost equal to the carbon price that would be requested for the goods manufactured under the EU’s carbon pricing rules. Additionally, each year importers will be obliged to declare the quantity of goods (in the scope indicated above) imported into the EU in the previous year and their embedded GHG.
For more information please contact
attorney Igor Bąkowski
tel. +48 22 633 67 66
or other lawyers from Bakowski Law Firm
bakowski.net.pl