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Anti-inflation shield is best protection against high prices says spokesman

The government has extended its anti-inflation shield till the end of October and will probably prolong it further, the Polish government spokesman has said.

The shield, which introduced a number of VAT cuts, was first brought in at the end of 2021 to combat rising inflation.

Prices of consumer goods and services (Consumer Price Index, CPI) increased by 15.6 percent year on year and by 1.5 percent month on month in June 2022, the Central Statistical Office (GUS) reported in a flash estimate on July 1.

“We will surely extend it further as we see that these moves are protecting us against even higher prices,” Piotr Mueller told a Polish public radio programme on Tuesday.

Under the shield, VAT on food products was cut to zero percent from the standard 5-percent rate, while VAT on fuels went down to 8 percent from the standard level of 23 percent.

The shield was to last until the end of July, but the Sejm, the lower house of parliament, decided in early June to extend it to October 31.

Mueller admitted that high inflation was “a subject of concern,” but added that high prices were mainly the result of the global situation.

“And we do not have as much influence on this situation as we want to, but we have been doing our best on the domestic level,” he continued, adding he had in mind such moves as, for instance, lowering income tax to 12 percent.

According to Mueller, the inflation peak is smaller thanks to actions taken by the government.


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