Compensation for Indirect CO2 Emission Costs Exempt from CIT — Supreme Administrative Court Cements a Favourable Line of Case Law

Another Confirmation of the CIT Exemption

The CIT exemption for compensation paid to energy-intensive installations for indirect CO2 emission costs has gained further confirmation in the case law of the Supreme Administrative Court (NSA).

The NSA Judgment of 26 June 2026

In its judgment of 26 June 2026 (II FSK 1245/25), the Supreme Administrative Court set aside the ruling unfavourable to the taxpayer issued by the Provincial Administrative Court in Kraków (I SA/Kr 274/25) and confirmed that compensation paid from the Fund for Compensation of Indirect Emission Costs benefits from the exemption under Article 17(1)(47) of the CIT Act.

Autonomy of Tax Law Instead of the Definition of a Subsidy

The NSA held that applying the exemption does not require reference to the definition of a subsidy under Article 126 of the Public Finance Act — it is sufficient that the benefit constitutes non-repayablefinancial assistance from public funds. This is already the second ruling in recent months by the court of cassation along these lines — the NSA took an analogous position in its judgment of 17 February 2026 (II FSK 1007/25), which we wrote about earlier.

A Shifting Line of Case Law

We can now speak of a clear consolidation of this line, even though in the meantime — in its judgment of 9 July 2024 (II FSK 397/24) — the court of cassation ruled differently, which for a time led provincialcourts to decide in line with the position of the tax authorities.

What This Means for Energy-Intensive Companies

For energy-intensive companies accounting for compensation as income exempt from CIT, this signals that reasoning based on the autonomy of tax law currently prevails in the case law.