Private Accommodation in Croatia Booming, EC Changing Rules

July 5, 2023 – Private accommodation in Croatia, as opposed to hotels, has been on the rise for some time. The same goes for other tourist countries in Europe. The European commission states that 70 percent of private renters are not registered for VAT. It therefore initiated a change in the VAT Directive, according to which everyone who rents apartments or houses to tourists, who are not in the VAT system, will also have to pay VAT on accommodation.

As Index / Vecernji write, renters will not be the ones to charge for VAT, but the platforms through which guests find accommodation. VAT on accommodation in Croatia is 13 percent, and the European Commission hopes that the changes will enter into force in January 2025. This should happen after all member states express their opinion on the proposal.

Last year, 550 million nights were spent in private accommodation in the EU. Croatia belongs to the group of countries that exceeded their pre-pandemic figures. Areas by the sea are still an absolute hit, but small villages and rural areas are gaining popularity. Eurostat’s data on overnight stays by guests who booked accommodation through Airbnb, Booking, Expendia and TripAdvisor stated so.

Regions with Highest Growth of Private Accommodation

Of the ten regions with the highest growth, nine were rural regions in France. Other popular areas were in Poland, Germany and Sweden. Of the 20 most popular regions in Europe, six are in Spain and France, five in Italy, two in Portugal and one in coastal Croatia.

Several years ago, the European Commission obliged the aforementioned four Internet platforms to submit data on the number of overnight stays. Some countries still take data for tax purposes.

Last year, Croatia increased the number of overnight stays in private accommodation from 20 to 28 million. In the first three months of this year, 530,000 overnight stays were achieved, ten percent more than last year. Last year, short-term stay of tourists in the capital of Croatia flourished, and the number of overnight stays almost doubled to 980,000 compared to 2021. Continental Croatia also fared well in the distribution of the tourist pie. The number of overnight stays increased by about 50 percent there, to 248 thousand. In northern Croatia last year, 30% more overnight stays were counted in private accommodation, about 135,000.

Areas by the Adriatic sea remain popular with around 26.6 million overnight stays in private accommodation. This represents 95 percent of all overnight stays in Croatia via the four popular internet platforms. The remaining 3.5 percent of overnight stays were in Zagreb, and 1.5 percent everywhere else.

 

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