ZPP Newsletter
Warsaw, 13th March 2023
Barriers to running a business in Poland – a constant, unchanging problem
High taxes, legal instability, and high labour costs have been the “TOP 3” barriers to doing business according to Polish entrepreneurs since 2019. Legal instability has since then become a much more severe barrier (36% of respondents in 2019, and 51% in 2023), and entrepreneurs in Poland similarly perceive barriers to the development of business activity. Ambiguous, overcomplicated, and unfavourable provisions of the law as well as extensive administrative procedures certainly make the “TOP 3”.
“The instability of the law as a whole is a major problem, but what is even more important is the complexity of economic and tax law. For seven out of ten entrepreneurs from the trade sector, this constitutes a serious barrier to running a business,” said Cezary Kaźmierczak, President of the Union of Entrepreneurs and Employers.
According to Polish entrepreneurs, the chief reason SMEs do not employ more people is the excessive cost associated with it. Since 2019, more than 60% of Polish entrepreneurs regardless of their sector have been of this opinion. Whereas when it comes to the main obstacles to investing capital by SMEs, Polish entrepreneurs claim the following: insufficient profits – 46% of respondents, fear of capital loss – 45%, and declining demand for services and/or products provided by the company – 41%.
“These results are confirmed by the findings of our latest Busometr survey for 1Q23. The vast majority of entrepreneurs said they were reluctant to invest and found employment costs problematic,” continued Kaźmierczak.
As many as 51% of Polish entrepreneurs said the largest barrier to starting a business in Poland was the lack of free funds to begin with, 46% of them were reluctant to take responsibility for the possible failure of their company (38% in 2019), and 36% had no vision for their business operations (46% in 2020).
According to 55% of respondents, non-refundable financial aid would be one of the best incentives to start one’s own business offered by the state along with an extended period of preferential social security (54%). Entrepreneurs also answered “lowering social security contributions or other taxes” to the question about “other” driving forces that would encourage them to start their own business.
“This proves Polish entrepreneurs support our actions and demands related to, for instance, the memorandum on the package for small businesses, which included an extended period of preferential social security or reduced disability pension contribution paid by micro-enterprises. What I find most pessimistic in this study is that basically nothing has changed in years,” he concluded.
METHODOLOGY
In January 2023, the Union of Entrepreneurs and Employers together with Maison Research House conducted a survey entitled “Barriers to running a business in Poland”. It is a cyclical survey conducted since 2019, using the CAWI technique with a sample of 534 companies from the SME sector.
See more: 13.03.2023 Barriers of performing business activity in Poland
