As Poland faces an intensifying demographic crisis, experts suggest that the country may need to rethink its pro-family policies. Despite the introduction of child benefit programs like 500+ and its successor 800+, birth rates in Poland have continued to decline, prompting calls for new solutions—such as income tax exemptions for working mothers, a model already in place in Hungary. According to the latest data from Statistics Poland (GUS), the country’s population could shrink to 30.9 million by 2060, a drop of nearly 7 million compared to 2022. At the same time, Poland’s fertility rate has fallen to 1.16—well below the 2.1 replacement level and one of the lowest in the European Union. This trend is expected to accelerate the ageing of the population. Projections show that by 2050, 40% of Poles will be past working age. Currently, there are 35 retirees per 100 working-age citizens; by 2060, that figure may rise to 64, placing significant strain on the pension system and labour market. While the 800+ program has improved financial conditions for lower-income families, its overall impact on fertility remains limited. According to experts from Personnel Service, the current benefits structure lacks incentives for middle- and high-income families to have more children. They argue that future policy should better integrate financial support with long-term family stability and labour market participation—particularly for women. A potential alternative is the approach taken by Hungary. Starting in October 2024, Hungarian mothers with three or more children are fully exempt from income tax for life. By 2026, the program is expected to include mothers with two children, expanding to younger age groups over time. This policy is projected to boost large families’ incomes by nearly 19% annually. For example, a woman earning the equivalent of PLN 6,000 gross per month could retain an extra PLN 1,000 in net income. Hungary’s broader pro-family strategy includes subsidised home loans, grants for family vehicles, and tax incentives for young parents. Since the implementation of these policies, Hungary’s fertility rate has risen from 1.23 in 2011 to 1.55 in 2023. In contrast, Poland’s fertility rate has not exceeded 1.4 in recent years and reached an all-time low in 2023. “Demographics represent one of Poland’s most urgent long-term challenges,” says Krzysztof Inglot, labour market expert and founder of Personnel Service. “Without bold action, the consequences for the labour market and pension system could be irreversible. Introducing income tax exemptions for working mothers—similar to Hungary’s model—could offer a stronger and more targeted pro-family incentive.” With fewer births and ongoing emigration among younger Poles, experts agree that policy changes are necessary. They argue that adopting elements of Hungary’s approach could help reverse negative trends and create a more supportive environment for families of all income levels. Source: Personnel Service