Apple Could Face New Taxes In Poland Under Proposed Digital Services Law - 9to5Mac

Poland is reportedly moving forward with a proposal to tax certain digital services revenue at up to 3%, potentially affecting companies like Apple. Here are the details.

New tax proposal could apply to multiple Apple services

Last year, Poland’s Ministry of Digital Affairs proposed a new law that would tax the revenue generated from certain digital services in the country.

As Reuters reported at the time, the move was harshly criticized by U.S. ambassador to Poland Tom Rose, who referred to it in a post on X as “a self destructive tax that will only hurt Poland and its relations w/USA.”

Now, also according to Reuters, the country has signaled that it will start working on the bill, “setting up a potential clash with ‌key ally the United States.”

According to the draft, revenue from certain digital services provided in Poland would be taxed at up to 3%, in what Poland’s Deputy Prime Minister and Minister of Digital Affairs, Krzysztof Gawkowski, described as an effort to create a more level playing field between domestic and foreign companies:

“Today, competition in the digital market in Poland is distorted. Companies that pay taxes on their activities in Poland are in a worse position than those that provide digital services within our country from abroad. This reduces the competitiveness of domestic entities, limits our digital sovereignty, and significantly reduces state budget revenues that could be reinvested in building our country’s technological potential. The economy is increasingly shifting into the digital sphere, and over time these inequalities would only deepen.”

As is often the case with proposals like this, the draft law uses broad language that leaves room for interpretation about what exactly would fall under it.

From the draft law:

The draft proposes introducing a compensatory tax on services provided within the territory of the Republic of Poland consisting of:

Placing targeted advertising on a digital interface aimed at users of that interface;

Providing users with a multi-sided digital interface that allows users to interact with other users or can facilitate the underlying supply of goods or provision of services directly between users;

Transferring, by sale, license, or another paid form, collected data about users, both individually and as part of data packages, generated as a result of user activity on digital interfaces.

The draft also outlines several exemptions, stating that the tax would not apply to:

Providing users with a digital interface where the sole or main purpose is delivering digital content owned by the provider or for which it has acquired distribution rights, or providing communication or payment services to users;

Selling goods or services online through the supplier’s own website, where the supplier does not act as an intermediary;

Providing regulated financial services by entities subject to supervision under Article 1(2) of the Act of July 21, 2006 on financial market supervision;

Providing, by a trading venue or a systematic internaliser, any of the services listed in Section A points 1–9 of Annex I to Directive 2014/65/EU of the European Parliament and of the Council of May 15, 2014 on markets in financial instruments, as well as amending Directive 2002/92/EC and Directive 2011/61/EU;

Providing, by a regulated crowdfunding service provider, any of the services listed in Section A points 1–9 of Annex I to Directive 2014/65/EU or services consisting of facilitating the granting of loans.

So again, while the text leaves plenty of room for interpretation, the language suggests that services such as the App Store, Apple TV, Apple Music, Apple Books, Apple Podcasts, and Apple’s growing ad business could fall under the new law.

At the same time, the exemptions are also broad enough that Apple could argue some of its services fall outside the scope of the tax.

Finally, while Apple is far from the only company that would likely be affected by the law, there are a few requirements that would narrow its scope. If approved, it will only apply to companies with more than 1 billion euros (roughly US$ 1.16 billion) in global revenue, and more than 25 million zlotys (roughly US$6.8 million) in domestic revenue in the previous reporting period.

Apple has yet to comment on the draft law.