Firmancy and its tax consequences in Polish law

Abstract

Tax fraud is one of the most dangerous violations of tax law. Their most common cause is the taxpayer's
desire to conceal the source or amount of money received. The use of another person's name, surname
or business name in a business activity, with that person's knowledge and consent, in order to hide or
conceal the true scope of the activity in question, is known as firmancy. It is illegal and qualified as tax
fraud. It is most often carried out in order to defraud a VAT refund or reduce the fiscal burden. Persons
committing firmancy are subject to fiscal and tax criminal liability. In the practice of the tax authorities,
it is not easy to collect evidence confirming the firmancy, Helpful in combating the practice is the
implementation into Polish law of the EU Directive DAC7. The directive imposed an obligation on digital
platform operators from EU countries to report to the tax authorities data on sales transactions of
goods and certain services made through their Internet.