As Poslovni Dnevnik writes, before we take to the subject at hand, it’s worth noting that Finance Minister Zdravko Maric did not accept the proposals of the National Association of Caterers on lowering VAT on beverages and respecting labour costs as a tax deduction. Let’s look at precisely why didn’t he satisfy this association’s wishes.
“We always end up talking about VAT somehow…” stated Maric.
“It’s not just a question of satisfying or not satisfying people’s desires. I mean, we always end up talking about VAT whatever the topic is. I do emphasise all the time for the hospitality sector, as well as for all other activities, this government in the past and this term, despite the pandemic, has conducted several rounds of tax relief to stimulate activities, employment, the raising of wages… Of course, in the wake of all this we’re continuing to work hard, and caterers always come up with this suggestion that the only exclusive variable is VAT. One of the interlocutors in this regard was the co-owner of a restaurant. Let’s just sit down and demystify a few things now. So… complete accommodation in tourism, complete food and service is already at a reduced rate. We’re only talking about bars here,” Maric said.
What would those numbers look like?
“We’re talking about approximately half a billion kuna. Now, looking at the data we have from the past year, it’s certain that the pandemic had a significant share in the hospitality sector, however, you know that the hospitality sector has been recognised with our measures since day one. At a time when it was horizontal for all sectors, and to this day the hospitality industry is one of the few that is the recipient of measures to preserve jobs and cover fixed costs.”
There has been a lot of talk about VAT in the last term of this government as well, it was promised that the general VAT rate would be reduced. In the end, that didn’t happen. Is it a topic at all anymore?
“It isn’t in the government’s programme at the moment. Let me remind you, there was a reduction in the income tax rate, especially for young people, you know that it all came into force and that it has already been done. Young people can testify to that, I’d also say that they were pleasantly surprised with those tax refunds. What follows, when the conditions for that are created, is written in the government’s programme that the reduction of VAT will be applied to all food in general, but we’l see when and how we’ll implement it,” stated Finance Minister Zdravko Maric.
Next came the topic of the pandemic-dominated season, and we’re not just talking about tourism here. Maric was asked if he was worried about the epidemiological situation and the possible sudden end of the tourist season, to which he responded:
“I think we really do all need to contribute individually to prevent that from happening. We aren’t talking only about tourism here but also all other economic activities. The third quarter is generally the strongest in terms of economic activity. Very soon our children will return to school. We really have a lot of segments that we have to take care of in order to finally gain this victory over the virus and to be able to live normally again,” Finance Minister Zdravko Maric replied.
The European Commission has now officially adopted Croatia’s National Recovery and Resilience Plan. What’s the next phase? When do the first funds arrive and what will they be used for?
“At the end of August, the government will authorise the signing of a financial agreement with the EU. After that, I expect a 13 percent advance in September of somewhere around 820 million euros. By the end of the year, Croatia must meet the 34 criteria it listed in the document, which is the basis for withdrawing an additional 700 million euros in the first half of next year. By the end of 2022, we need to meet the requirements that will ensure the withdrawal of 46 percent of the total envelope of money, which is very good news because it means that at the beginning of this period, we’ll be able to use the most funds,” concluded Finance Minister Zdravko Maric.
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