Sugar tax – challenges

Preparation for new regulations requires potential taxpayers to take a number of actions in order to identify new obligations, calculate and pay the tax and provide the authorities with the necessary information in
the form required by law. A wide range of obligations will require cooperation between financial and accounting, logistics and IT teams. Taxpayers will face numerous challenges:

• Classification doubts – new regulations impose obligations on entrepreneurs placing specific products on the market, providing for a number of exemptions in this respect. In connection with the above, it is necessary to conduct a detailed analysis of the offered products in order to determine whether they fit into the catalog of products covered by the new obligations, which, due to the complexity of the classification analysis process, is a significant challenge.

• Contracts analysis – new regulations differentiate the scope of duties depending on the function the entity perform in the supply chain. Hence, to determine the scope of obligations it is necessary to
  identify individual supply chains and determine the position of individual participants, which requires an analysis of concluded contracts and commencing communication with suppliers and recipients.

• IT changes – with the entry of new regulations, entrepreneurs will be required to implement mechanisms to report a wide range of information (delivered products along with information about their
  composition, invoice numbers and batch numbers), which are usually not stored in financial and accounting systems. The need to adapt systems in such a short time can be a significant obstacle to
  meeting the imposed requirements.

• Sanctions – failure to comply with the statutory obligations may result in an additional fee of 50% of the amount of the tax due.

PwC’s support
PwC offers support in the process of preparing the enterprise for new regulations. Our services aim to support the Clients through the following stages:

Support

• Classification analysis – based on our experience gained during similar projects, we are able to provide support in the process of classification analysis, the purpose of which will be to identify the catalog of products covered by new obligations;
• Business analysis – our support in this area focuses on the analysis of supply chains and contracts regulating them to determine the detailed scope of obligations arising from the adoption of a specific position within individual chains. At this stage, we also provide support in the process of communication with contractors, the purpose of which is to gather additional information, as well as build awareness of the changes introduced and the consequences they bring in the context of adjusting existing transaction conditions;
• System analysis – our support is aimed at determining the current possibilities of collecting and transferring data, as well as at implementing solutions that will allow to meet the imposed requirements (systems adjustment / outsourcing of the
  reporting process);

Your Contact:
Tomasz Kassel
Partner
+48 502 184 846
tomasz.kassel@pwc.com