Size of government in Poland is not excessive, with total government spending reaching 41.5% of GDP in 2015, a much lower level than in many EU countries. Although Poland was one of few countries in Europe which did not experience recession during the financial and fiscal crisis, and has recorded solid growth rates - 3.7% in 2015 - high annual deficits have accumulated a substantial amount of public debt, reaching 51.3% of GDP in 2015. Fiscal austerity measures that were implemented have lowered the deficit in order to enable Poland to exit from Excessive Deficit Procedure of the EU in 2015, one year in advance than previously envisaged, but there are warnings that further actions need to be taken, since public expenditures are being expanded and privatization plans have been stalled.
Government still owns and operates numerous enterprises in various sectors of the economy, even though a thorough privatization process took place in the 1990s. Some of these companies do not operate inefficiently, relying on direct funding from the state for their operations via subsidies. The current government has suspended the privatization plan of the previous government, regarding most of the remaining SOEs. As much as 50 SOEs are recognized as being of strategic importance and therefore they are to remain in the government portfolio, while the government has announced strong improvements in their corporative practices and management. Income tax is progressive, with lower rate at 18% and higher at 32%, applied above a moderate threshold. VAT level is set at 23%, with privileged rates of 5% and 0% on some products. High social security contributions have led to a high share of non-fixed temporary working contracts (‘’junk contracts’’) among the working population, because of lower social contributions scheme applied to them.