Despite government’s assurances, for some owners, the new property tax will be much higher than the current communal fee.
Town and municipalities in Croatia have begun collecting real estate data in their areas, which will help them calculate the amount of the newly-imposed property tax, which is scheduled to replace the current communal fee starting from January. However, citizens are protesting and signing petitions against the tax, and many complain about vague forms and lack of instructions, reports Jutarnji List on 9 August 2017.
The amount of tax on apartments and houses in which citizens live permanently will allegedly be similar to the current communal fee, while for all other residential properties that fall into the category of non-permanent accommodation, such as second apartments, holiday homes and cottages, the tax might be as much as 40 percent higher, depending on the purpose of the property, year of construction and the condition.
The Tax Administration has prepared some initial provisional calculations, on the basis of a 100-square-metre property for permanent accommodation. The tax has been calculated on point value and zone coefficients which have already been determined for the payment of communal fees, and therefore it can be expected that towns and municipalities will not change them, although they have the right to do so if they want to.
Thus, for virtually all properties constructed up to 1987, which was taken as “the year zero”, since the majority of the housing stock had been built by then, the tax will be somewhat smaller or roughly the same as the communal fee. For newer properties, it will be larger than the fee.
For properties for non-permanent accommodation, the tax will depend on their condition and purpose. For example, for 100-square-metre holiday homes constructed up to 1987, the tax should amount to about 2,100 kunas a year, which is similar to the amount currently paid for the current holiday home tax and communal fee. But, if the holiday home has additional facilities, such as a pool, a sauna or a sports gym, the tax could amount to 2,520 kunas. If the holiday home with additional amenities was built after 2006, the amount of the tax would rise to 3,024 kuna, which is 924 kunas or 44 percent more than the owners pay now.
The situation with properties in which people live permanently is somewhat better: for 100-square-metre apartments and houses which were built before 2005, the tax will be 1,320 kunas, just a bit more than the current fee which is 1,200 kunas. For properties built after 2006, the fee will be 1,440 kunas, which is 240 kunas or 20 percent more than in the past.
However, these calculations will be accurate only if local government units do not change the parameters for tax calculation. The annual amount of tax per square metre of the property will be determined by multiplying the point value, the zone coefficient and the coefficient of purpose, plus two new criteria – the coefficients of condition and age.
Some coefficients have been prescribed by law, while towns and municipalities themselves will determine the point value, zone coefficient and purpose coefficient, as well as deadlines for paying taxes. Local authorities have until 30 November to make these decisions. Additionally, there is also a corrective coefficient for properties for non-permanent housing, which increases the base coefficient and therefore the amount of tax. It has been introduced as a substitute for the holiday home tax, and it cannot be less than 1 or higher than 6. The Tax Administration used 2.5 in its calculations.
Since towns and municipalities will determine these parameters on the basis of property records, they have started collecting data on properties in their areas. They already have records and parameters for those properties which have already been paying the communal fee and the holiday home tax, but they need to collect data on age and condition of individual properties.
This method for calculating tax is expected to last until 2020 when the second phase should be introduced and the tax instead be based on the estimate of the value of each individual property.
Towns and municipalities have begun with a hurried gathering of data. Some have invited citizens to fill out a real estate registration forms on their websites and deliver them in person to their offices or send them via e-mail. Some towns have not yet begun collecting data, while others have announced they will send the forms to owners’ home addresses. However, apart from the standard information on who owns and who uses the residential property, when it was built or reconstructed, and how large the useful area is, citizens also have to write in the cadastral plot number, the name and number of the cadastral municipality, and the land registry number. Many people do not know this information. Also, citizens are required to assess the condition of their property and state if there are additional facilities. The deadline for the submission of data is 31 October, but some towns have introduced their own, much shorter deadlines. In Zaprešić, for example, citizens have to submit data by the end of August.
Taxpayers are obliged to submit the requested data on time, or the property tax will be calculated according to the highest coefficients, which has caused protests. “The form has room for just one owner. In cases where a property has multiple owners, people cannot write in other owners, and there is no explanation what they should do. Secondly, there are no instructions how to fill in the form and where to find the information required. Thirdly, under the heading ‘What if I do not send the requested information’, it states that the maximum tax will automatically be calculated. Such provision does not exist anywhere in the law, and it is against the Constitution and the EU statutes,” complained one citizen.
Translated from Jutarnji List.
