Thousands of Polish shopkeepers protest planned tax

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Warsaw (AFP)

Around 3,000 Polish grocers on Thursday gathered before the Polish parliament to protest against a turnover tax planned by the new conservative government, which could see smaller domestic retailers taxed the same as large foreign supermarkets chains.

The Warsaw protesters carried banners with slogans like, "The government is stabbing traditional Polish retailers in the back" and "This is the death of Polish retailers". franchises".

They claim the planned tax, generally described as a supermarket tax, could bankrupt grocery stores often run by families on a franchise basis.

"Were this tax to come into effect, it would be a disaster for us, our stores will go bankrupt," said Danuta Ziaja, a sales clerk at a store within the Leviatan franchise.

"Supermarkets will hang on but not our small stores," said Ziaja, who made the 500-kilometre (300-mile) journey from the western town of Zagan to voice her anger at the government led by the righ-wing Law and Justice (PiS) party.

"By taxing us, the government is desperately looking for money for its child allowance programme," she told AFP, referring to the monthly 500 zlotys ($130, 110 euros) promised per child to each family, starting from the second child.

The planned turnover tax would see retailers with annual profits higher than 300 million zloty taxed at 1.3 percent of their earnings, while companies earning less will have to pay 0.7 percent.

Retail sales made on weekends and holidays will be taxed at 1.9 percent to the frustration of small retailers, who earn most of their revenue on Saturday.

The finance ministry hopes to net some two billion zloty through the levy in 2016.

"They're treating foreign supermarkets the same as small 100-square-metre stores," said protester Artur Bogacki, owner of two small stores belonging to the Livio franchise.

"If the government doesn't change its plans, I'll have to close shop," said Bogacki, who employs eight people in the central city of Konin.

Following talks with protesters, government representatives promised to re-think their plans in order to protect small retailers, the Polish PAP news agency reported.

The PiS won an unprecedented majority in October's general election thanks in part to promises it would tax foreign-owned hypermarkets while cutting taxes for small and medium-sized businesses.

It also vowed to lower the pension age, introduce generous family benefits and impose taxes on banks.

The plans have drawn sharp criticism, with analysts warning they could destabilise public finances and the banking sector.