Debate Over Cadastral Tax Resurfaces In Poland

In Poland, the debate over the potential introduction of a cadastral tax has resurfaced, with Minister of Funds and Regional Policy Katarzyna Pełczyńska-Nałęcz weighing in on the matter during a recent interview. Pełczyńska-Nałęcz stated that the current government does not have a cadastral tax included in its coalition agreement and is not obligated to implement it. However, she expressed her personal view that such a tax should apply to individuals owning three or more apartments.

According to Pełczyńska-Nałęcz, only 0.8% of people in Poland own three or more apartments, indicating that the tax would affect a small group of property owners. She argues that taxing this demographic could serve as a pro-development measure, redirecting capital from real estate investments, often termed "concrete investments," to more productive areas of the economy, such as startups and businesses.

"The key to all this, the common denominator, is pro-development policy," Pełczyńska-Nałęcz said in her remarks. "If we tax this small social group that owns three or more apartments, it would discourage investment in concrete and encourage investment in startups, companies, the economy, and development. The idea is to prevent money from getting stuck in concrete and instead let it flow into development. Concrete, which refers to apartments, serves the purpose of housing. If people are discouraged from investing in apartments, others will be able to buy these apartments at a reasonable price," she explained.

Despite her advocacy for a cadastral tax, Pełczyńska-Nałęcz is not alone in her views. The discussion around this tax has been ongoing for years, particularly as international institutions like the International Monetary Fund (IMF) and the Organisation for Economic Co-operation and Development (OECD) have recently recommended that Poland adopt a property tax system based on market value. This recommendation aligns with practices in most OECD countries, which could potentially provide a more accurate reflection of property values.

The current property tax system in Poland calculates taxes based on the area of the property, meaning that a dilapidated building on the outskirts of a city could be taxed at the same rate as a luxury apartment in the city center if they are the same size. Critics of this system argue that it fails to account for the actual value of properties, particularly in urban areas where property values can vary significantly.

For instance, if a cadastral tax were applied at a rate of 3% on a property valued at 250,000 PLN, the annual tax would amount to 7,500 PLN, a stark contrast to the typical 150 PLN property tax currently imposed. This significant difference has raised concerns about the potential financial burden such a tax could place on property owners, especially those with lower incomes or retirees living in desirable locations.

In February 2025, Deputy Finance Minister Jarosław Neneman confirmed that the ministry is not currently working on implementing a cadastral tax. Nonetheless, the conversation continues, as many stakeholders express concern about the implications of such a tax.

Supporters of the cadastral tax argue that it could serve as a fairer method of taxation and provide a stable source of revenue for both the state budget and local governments. They believe it could also help curb speculation in the real estate market, making housing more accessible to the general public.

However, critics warn that the tax could disproportionately affect low-income property owners, particularly those living in high-value areas. The fear is that high tax rates could force these individuals to sell their properties, leading to increased rental prices and reduced maintenance of existing housing stock.

The potential introduction of a cadastral tax has also raised eyebrows among politicians, many of whom own multiple properties. According to asset declarations, several members of the Polish parliament own more than two apartments, with some having as many as twelve. For instance, Robert Kropiwnicki from the Civic Coalition reported owning twelve apartments, while Małgorzata Niemczyk also from KO declared ten. This has led to speculation about how a tax on multiple properties would impact lawmakers personally.

Minister of Internal Affairs Tomasz Siemoniak and Minister of Industry Marzena Czarnecka are among those in government with substantial real estate holdings. Siemoniak declared four properties valued at 400,000 PLN, 550,000 PLN, 540,000 PLN, and 1.5 million PLN, while Czarnecka owned or co-owned seven properties, including two houses and several apartments.

As discussions continue, the government faces the challenge of weighing the potential benefits of a cadastral tax against its possible drawbacks. The implementation of such a tax would require significant investment in property valuation systems and ongoing management costs, raising questions about its feasibility.

In conclusion, while the idea of a cadastral tax is gaining traction, particularly among some policymakers, it remains a contentious issue. The balance between generating revenue for the state and ensuring affordable housing for citizens is a delicate one, and the future of property taxation in Poland remains uncertain.