The new Polish president, Karol Nawrocki, considered exempting families with children from paying income tax as his «obligation» for Poland to continue to exist as an independent state. The Hungarian government says that since 2010, state spending on family support has increased fivefold and will reach the equivalent of €12.3 billion in 2026. Often, in an ultra-competitive international economic environment such as today, governments favor certain companies, businesses, industries and economic participants to ensure that the country remains competitive and relevant at least regionally. Tax exemption is the most handy tool. It is a loss of resources that in theory will be compensated by the value brought by the favored ones. Given the negative demographic trends in much of the world, such as population aging in Western Europe and depopulation in Eastern Europe, the hardest battles for competitiveness are announced to be, or should be, for what is becoming the most valuable resource, man. Western states, richer, more attractive, can import people. The chance for Eastern European economies is either to produce them or to accelerate their development. The first option seems simpler. But no one can guarantee that in a Europe that values freedoms, young people will stay with them in the country, that they will not become another waste of resources. But whatever they choose, young people must first exist. When at the beginning of the year Hungarian Prime Minister Viktor Orban announced the most daring package of social protection reforms in Europe, the news went around the continent. At the heart of these reforms is the lifetime exemption from paying income tax for mothers with two, three and more children. Critics said it was a communist model designed to create «heroine mothers,» child-bearing women who would live off of it alone. But what Orban proposed then was given as a positive example from Great Britain to Turkey. After all, exempting mothers from paying income tax is a minimal effort on the part of the state, especially given the explosion in the cost of living in the EU and elsewhere after the COVID-19 pandemic and the coming energy crisis. Meanwhile, this program has been extended to Hungary. And similar measures were adopted by the government of Poland. In February this year, the Hungarian government announced that from October 1, mothers with three children will no longer pay income tax. It is about 250,000 women. Also, for mothers with two children, the exemption will be made gradually, over four years, depending on age. In 2026, no mother up to 30 years old will be taxed by the state. Mothers aged up to 40 with two children will no longer pay starting from 2026, and those aged 40-50 will be exempted from 2027. In 2028, it will be the turn of the 50-60 age group. For mothers over 60 with two children, the exemption will be introduced from 2029. As can be seen, especially young mothers are encouraged. Logic says that a young woman can have more children. These «unique in Europe» tax measures, as the Hungarian government described them, have been extended so that from January 1, 2026, even mothers up to 30 years old with only one child will no longer pay income tax. Authorities in Budapest say that since 2010, state spending on family support has increased fivefold and will reach the equivalent of 12.3 billion euros in 2026. Poland introduced this fall a policy of zero income tax for families with at least two children. Cumulative income must be less than the equivalent of 33,000 euros per year. Adoptive or temporary parents, legal guardians and people who take care of adult children who are still studying (up to 25 years of age) benefit from the exemption. Therefore, the «reform» applies to anyone with parental responsibilities. The law was promised in the electoral campaign by the new president, the conservative Karol Nawrocki. And he kept his promise. It aims to support the family (an essential element in the electoral platform of a politician who values traditional values), increase household income and stimulate economic activity. Nawrocki also wants to attract the massive Polish diaspora back to the country. For politicians like Orban and Nawrocki, the alternative of attracting foreigners, migrants, does not exist. Both Orban and Nawrocki are supporters of family-friendly fiscal policies, that is, taxes and fees that are not burdensome for households. «Taxes must be low, simple and family-friendly,» the Polish president said before the election, which he won. Exempting families with children from paying income tax was considered his «obligation» for Poland to continue to exist as an independent state. Poland currently has one of the lowest fertility rates in the world. The population is shrinking. According to the presidential office's estimates, an average Polish family will be better off financially by around 1,000 zlotys (235 euros) each month thanks to this new tax break. Parents earning 12,000 zlotys (2,826 euros) a month will save around 913 zlotys (215 euros) each month – which is more than 11,000 zlotys (2,590 euros) a year. Those earning the lowest national income can expect savings of around 75 zlotys (17 euros) per month, while people earning below the tax-free threshold will not experience any change, as they are already exempt from income tax. It is money that is certainly welcome in the family budget. But, analysts say, the amounts are too small to convince the family to embark on such an expensive and long-term mission as raising children.
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