Public Sector Budgeting in Poland: Challenges and Opportunities in a Changing Economy

This paper examines the challenges faced by Poland's public sector enterprises and organizations as they manage budgets during the country's transition to a market economy. It investigates how traditional budgetary principles interact with new economic development concepts, drawing on development economics to understand the unique context of Poland's systemic shift. The study analyzes empirical data and public finance trends, arguing that maximizing tax revenue through higher burdens is counterproductive. Specifically, the paper explores how escalating tax burdens on public sector units can stifle economic growth and contribute to the expansion of the shadow economy. Instead, the paper proposes a focus on rational and efficient resource allocation within the public sector as a means to bolster budgetary revenues without hindering overall economic development. This study offers valuable insights for policymakers and researchers interested in understanding the complexities of public finance management within transitional economies.