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The Taxation of Entrepreneurial Income in a Transition Economy: Issues Raised by Experience in Poland


  • Grabowski MEP, Dariusz Maciej
  • Smith, Stephen


This paper considers the taxation of small business and entrepreneurial incomes in Poland. In both transition economies and existing West European market economies, the efficient taxation of entrepreneurial incomes presents particular difficulties, partly due to the absence of clearly defined `borderlines', for example between labour and capital incomes, and between business expenses and private consumption. The treatment of income volatility, of social insurance contributions, and of inheritance by the tax system can easily have a non-neutral impact on the balance between entrepreneurial investment and other investments. The paper considers how these problems could be addressed, and outlines a number of issues specific to the taxation of entrepreneurs in transition economies.

Suggested Citation

  • Grabowski MEP, Dariusz Maciej & Smith, Stephen, 1995. "The Taxation of Entrepreneurial Income in a Transition Economy: Issues Raised by Experience in Poland," CEPR Discussion Papers 1166, C.E.P.R. Discussion Papers.
  • Handle: RePEc:cpr:ceprdp:1166

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    More about this item


    Entrepreneurs; Fiscal Policy; Small Businesses Poland; Tax Reform; Taxation; Transition Economies;

    JEL classification:

    • H25 - Public Economics - - Taxation, Subsidies, and Revenue - - - Business Taxes and Subsidies


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