In a move intended to alleviate the government’s budget deficit by targeting ‘tax optimization’ schemes, Poland’s ruling party Law and Justice has introduced a bill that would have major implications for closed-end funds in Poland. Under the new law, local funds would no longer be exempt from paying tax on profits made on interest, dividends, capital gains from the sale of receivables, shares and stocks as well as other securities. The profits of closed-end funds would be become subject to a 19 percent taxation rate. The new tax law is due to come into force in January, 2017 and is expected to hit the returns that Polish and foreign funds are able to generate in Poland.
