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New Deal and OFE Liquidation.  What about transfer fees?

New Deal and OFE Liquidation. What about transfer fees?

By exempting pensions of up to 2,500 Polish zlotys from tax, the Law of Law and Justice is being thrown into a trap, because thus it cannot collect nearly 12 billion PLN in fees for converting OFE into IKE – notes Rzeczpospolita. The Minister of Finance stressed that “there is no decision” on reducing the transfer fees, and the Ministry of Finance and Regional Policy indicated that “proposals for detailed solutions in this area are currently under analysis.”

As Rzeczpospolita recalls, the open pension fund liquidation scheme, enforced by the government for nearly two years, assumed that money from there would go to its members ’individual retirement accounts (IKE) or – if they so desired – to their ZUS accounts.”

The government wanted to collect 15 percent of the money that would go to IKE. Transfer fee.

“He argued that this roughly equals the future income tax collected on this benefit. If half of OFE’s members decided to switch to IKE, the government would have collected nearly 12 billion PLN (according to the value of OFE’s assets at the end of March). That is in the Lada program. Polish that was announced recently, there was an announcement of a pension tax exemption up to 2,500 PLN and the justification for transfer fees is out of date. ”- explains the paper.

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What about transfer fees?

On Monday, RMF Radio announced that with most pensions exempt from taxes, the government plans to cut transfer fees from 15 to 10 percent. “This was not confirmed by the Ministry of Finance, and according to our informant, it is an idea before the announcement of the Polish system and the decision to reform open pension funds,” – writes daily.

Today we can see why the government was in a hurry with the measure that was supposed to lead to the liquidation of OFE. The idea was to do so before the Polish deal was announced, tax-free for most pensions and quickly adding billions to the budget – said Bowie Wojczkovsky, chief economist at Employers in Poland, in an interview with Rzeczpospolita.

The Ministry of Finance and Regional Policy pointed to reports of possible transfer fee cuts.

“ The government has repeatedly indicated that the aim of the legislative activities implemented as part of the reform of open pension funds is to develop solutions that ensure equal treatment for all insured and give Poles a real right to choose between a private and fully funded pillar of the pension system, transfer of funds from OFE to the public and payment system. Run by the Social Insurance Institution, “the ministry wrote in response to questions from TVN24 Biznes.

“ Potential receivables under common law in the above range (income tax on pensions and transfer fees on funds from OFE, bearing in mind that the funds transferred to IKE will be fully private and free of all taxes in the future) are likely to be equivalent and it does not differentiate between The legal status of individual groups of insured persons .. Proposals for detailed solutions in this regard are currently being analyzed and will be presented to the public as soon as possible “- reads the position of the ministry.

Finance Minister Tadeusz Kosinski was asked on Monday during a meeting with reporters whether the scheduled fee would be reduced and to what level in the event of the OFE liquidation and switching to IKE, up to 15 percent. “There is no decision at the moment,” said Finance Minister Tadeusz Kosinski. As Deputy Minister Jan Sarnovsky noted, the issue will require “some moderation”.

Rzeczpospolita, PAP, TVN24 Biznes

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