Profamily policy PwC CEE

1. Profamily tax reliefs:
CEE in the European Union
www.pwc.pl

2. PwC’s Digital Services
About the methodology
2
Assumptions:
Aim: what aid an average family can count on in specific
EU countries in 2017
A simulation was conducted for each country in accordance with the adopted
assumptions
Family 2+2
Working parents
Each parent earns the national average wage
Children aged 4 and 8
The children are healthy
The survey took into consideration
key elements of financial support
for families with children in tax
systems and in respect of family
benefits in European Union countries
in 2016:
Not accounted for:
price of the basket of goods,
free meals, medicines and
school textbooks for children,
individual deductions (not for
children)
Family supporting tax reliefs
Allowances for children
Remuneration amount

3. PwC
Conclusions from our analysis (EXAMPLE: POLAND)
The average amount of EU state aid in respect of allowances for children and family
benefits is approx. PLN 10,538 per year, in Poland this amount is PLN 8,225.
1
When comparing the level of support with the average salary, Poland continues to
be ranked 4th among EU countries.
2
The funds themselves do not guarantee success, what counts is the efficiency of
their use Countries with systemic solutions are successful.
3
3
A modern approach to family support policy involves, in addition to financial
assistance, an increasing role of employers in supporting families raising children.
4

4. PwC’s Digital Services
Poland is still ranked 4th among EU member states:
support with reference to the average remuneration
4
Total state support/average remuneration of spouses/partners in 2017 (in EUR)
POLAND, with a result of
7.9%, continues to rank 4th,
as in the previous year
FRANCE, with a result of
13.7%, is still in the lead
4.9% average support
with reference to average
remuneration
in EU states
13.5
percentage
points difference
between the states at
both ends of the scale
LITHUANIA up 18 points with
3.7%, due to increased child
allowances (up by 1.3%)
CROATIA's advance to the 5th place
with a result of 7.4%, following an increase in
child allowances (up by 1.7 p.p.)
France
Hungary
Austria
Poland
Croatia
Luxembourg
Latvia
TheNetherlands
Estonia
Slovenia
Belgium
Germany
Slovakia
EU
CzechRepublic
Sweden
Ireland
Portugal
Lithuania
UnitedKingdom
Finland
Denmark
Romania
Malta
Italy
Spain
Greece
Cyprus
Bulgaria
0.0%
0.2%
0.4%
0.6%
0.8%
1.0%
1.2%
1.4%
1.6%
Source: PwC proprietary analysis
(based on simulation)
LITHUANIA advances to 18th
position with 3.7%, due to
increased child allowances (up
by 1.3%)

5. PwC’s Digital Services
State support
from EUR 1,000
to EUR 2,000
0
1000
2000
3000
4000
5000
6000
7000
8000
Luxembourg
France
Austria
TheNetherlands
Germany
Belgium
Denmark
Ireland
Sweden
Finland
EU
Hungary
UnitedKingdom
Slovenia
Croatia
Poland
Estonia
Italy
Latvia
CzechRepublic
Portugal
Slovakia
Spain
Malta
Cyprus
Lithuania
Romania
Greece
Bulgaria
Savings on allowances Family supporting benefits
The average amount of EU state aid for a model family
in 2017 amounts to EUR 2,383 (PLN 10,178)
Total state support in 2017 (in EUR) – child allowances and family supporting benefits
Average annual support
from EU states:
EUR 885
child
allowances
EUR 1,498
child benefits
Luxembourg
EUR 7,538
(PLN 32,190)
France
EUR 6,786
(PLN
28,979)
Poland:
EUR 1,926
(PLN 8,225)
Source: PwC proprietary analysis (based on simulation)

6. EXAMPLE: Direction for Poland — systemic solutions
6
Bonus for speed – if another child is
born within 30 months of the birth of the
previous one, the parental leave can be
extended by as much as
one year.
The Latvian example shows that the fertility
rate can be increased provided that structural
changes, tailored to expectations of potential
parents, are implemented.
Denmark: owing to a well-developed
nursery and kindergarten infrastructure,
parents can reconcile their family and
professional life. Thanks to this and to the
long-standing traditions of family-friendly
policy making, the fertility rate stays at a
constant level and is one of the highest in
the EU.
Denmark is built on nurseries! — up
to approx. 77% of children under 3
years of age are taken care of through
institutions such as nurseries
(only approx. 5% in Poland). This is
the highest rate in the EU.
Latvia — the strongest increase in fertility
rate in the EU over recent years, by nearly
40% from approx. 1.22 in 2001 to
approx. 1.7 in
2015 — an increase resulting from,
among other factors:
expanding the group of people eligible
for aid and harmonising the rules of
granting benefits, as well as introducing a
government programme for infertility
treatment.
Owing to a consistent family-oriented policy,
Sweden has good demographic prospects in
Europe.
Swedish family-oriented policy is characterised
by stability and structural solutions.
77% of children aged 1-3 and 97% of
children aged 4-5 attend
nurseries or kindergartens.

7. PwC’s Digital Services
PwC
Using appropriate state incentives and reliefs for families may contribute to increased fertility…
But will this be enough?
7
France and Germany support families to a great extent, however…
… in France the tax incentives and reliefs lead to a high fertility rate, whereas in Germany this rate is one of the
lowest in the EU.
In most EU countries, the relationship between family support tax
incentives and reliefs, and the fertility ratio is noticeable. However, there
are exceptions where there is no straightforward relationship...
Fertility rates in EU states*
The fertility rate
in Poland (1.34) is
one of the lowest
in EU
* Data relating to 2015; Source: Eurostat data
0.00
0.01
0.01
0.02
0.02
0.03

8. PwC’s Digital Services © 2017 PwC Polska Sp. z o.o.
Joanna Narkiewicz-Tarłowska
Director, Tax & Legal Department at PwC Polska
joanna.narkiewicz-tarlowska@pwc.com
Iwona Boniecka
Senior Consultant, Tax & Legal Department at PwC Polska
iwona.boniecka@pwc.com
Contacts