M. Continuo

Poland's opposition lays out spending plan to gain votes

By Wiktor Szary and Pawel Sobczak

KATOWICE, Poland (Reuters) - Poland's main opposition party laid out plans on Saturday to increase public spending by 2.3 percent of annual output, calling it an investment that will improve the lives of Poles, accelerate economic growth and yield new tax revenue.

Opinion polls give a socially conservative alliance led by the Law and Justice (PiS) party a wide lead over the ruling pro-business Civic Platform ahead of October's parliamentary election.

Beata Szydlo, the party's candidate for prime minister, said new spending as a result of policies such as lowering the retirement age and raising child benefits would cost a total 39 billion zlotys ($10.33 billion) annually.

"Our starting point is the assumption that the more money stays in the pockets of Poles, the better for the citizens, for the economy, for the budget," Szydlo said at a party convention.

"This is not a cost, this is an investment."

Szydlo said that increasing tax collection rates and curbing the transfer of corporate profits abroad would yield 56 billion zlotys, while a new planned bank tax should yield 5 billion zlotys per year in new tax revenue.

A new tax on supermarkets, most of which are foreign-owned in Poland, would yield 3 billion zlotys annually, Szydlo said.

"We must make it so that everyone will starts benefiting from economic growth, and not just 10 percent of society, as is the case now," Szydlo said.

She said total increases in tax revenue would reach 73 billion zlotys, or 4.2 percent of GDP, annually.

The remaining 34 billion zlotys or 1.9 percent of GDP would be used for "constructing a budget without deficit and for development investment", a flyer distributed during the PiS convention said.

Szydlo also said Poland needed to reduce the share of foreign ownership in the banking sector, now at about 60 percent.

Poland's economy grew by over 20 percent since 2007, but wage growth has lagged, leaving many Poles disappointed. The average wage in Poland is still about a quarter of that in Germany.

(Reporting by Wiktor Szary and Pawel Sobczak; Writing by Marcin Goettig; Editing by Kevin Liffey)

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