Polish government demands Karol Nawrocki sign 4 billion PLN windfall tax on fuel companies

Cabinet demands presidential assent on windfall tax

Polish government ministers intensified demands on 30 September for President Karol Nawrocki to sign legislation imposing a windfall tax on fuel companies. The bill, passed by the Sejm on 18 September and approved without amendments by the Senate, levies a tax on excess fuel earnings between March 2026 and March 2027 to generate an estimated 4 billion PLN. The government plans to use these revenues to renew the "Ceny Paliwa Niżej" price-shielding program, which expired at the end of August. Speaking ahead of a G20 trade ministers meeting in Milwaukee, Finance and Economy Minister Andrzej Domański stated that fuel corporations are recording high profits while drivers face elevated retail prices. Deputy Prime Minister Krzysztof Gawkowski and MP Tomasz Trela held a press conference outside the Presidential Palace in Warsaw, arguing that the measure would reduce pump prices by 1.50 to 2 PLN per litre.

We want to tax the largest fuel companies and use these funds to lower fuel prices at Polish stations. President Nawrocki has the opportunity to stand on the side of Poles rather than on the side of big fuel corporations.

Presidential counter-proposal and constitutional objections

President Karol Nawrocki has withheld approval of the measure, citing constitutional concerns regarding retroactivity. The presidential chancellery previously referred an earlier version of the windfall tax bill to the Constitutional Tribunal in July on grounds that it retroactively applied to profits earned from March to December 2026. Instead of the cabinet levy, Nawrocki introduced an alternative legislative proposal named "Paliwo Kosztuje Normalnie". The presidential initiative seeks to introduce statutory caps on refinery, wholesale, and import margins, grant the finance minister flexibility to lower excise duties, and exempt retail fuel sales from the retail sales tax through 31 March 2027. Presidential spokesperson Rafał Leśkiewicz and deputy chief of staff Adam Andriuszkiewicz stated that the administration's plan delivers direct relief without constitutional defects.

The government says that after its law enters into force, fuel prices will fall by about one zloty. The president's proposal, on the other hand, envisages reducing fuel prices from 1.70 zlotys to over 2 zlotys per litre.

Legislative timeline and market impact

The dispute follows price increases across domestic petrol stations after the expiration of the initial price relief package. On 1 September, value-added tax rates on petrol and diesel reverted from 8% to 23%, which increased station prices by approximately 1 PLN per litre. By the final week of September, 95-octane petrol rose to 8.19 PLN per litre, while diesel exceeded 9 PLN per litre. A recent survey showed that 71% of Polish citizens expect government intervention to curb fuel costs.

Escalating political friction across branches

Prime Minister Donald Tusk published a video address on 28 September urging Nawrocki to sign the legislation before the winter holiday period to prevent further increases in consumer living costs. Speaker of the Sejm Włodzierrz Czarzasty also addressed the issue publicly, attributing fuel inflation to international disruptions in the Strait of Hormuz alongside the president's legislative resistance. Presidential aides rejected the criticism as political deflection, asserting that executive responsibility for price stability rests with the government. With the bill awaiting presidential action, coalition officials warn that transport costs will add upward pressure on grocery and retail goods pricing.