Coronavirus Pandemic Encourages Croatian Cities to Cut Surtax

As Jadranka Dozan/Poslovni Dnevnik writes on the 9th of June, 2020, as a source of revenue for local budgets, surtaxes are more important for larger cities, so they’re harder to give up for some. However, the coronavirus pandemic has caused several to think again…

Valpovo and Motovun will both abolish the surtax on income tax at the end of this month. The aforementioned locations thus join a small number of local units in Croatia whose residents don’t have the burden of surtax on their backs, as well as everything else they need to think about in these coronavirus-dominated times.

Pozega and Belisce both reduced their surtax on income tax from 10 to 7 percent back in early June, and a month earlier (in early May) the municipality of Donji Miholjac started applying a 5 percent surtax instead of the previous 8 percent surtax. At the same time, in Bjelovar, an extremely forward-thinking continental Croatian city that has made the biggest strides in the area of ​​local levies in the past few years, a zero surtax rate has been in place since May.

Bjelovar’s city authorities, led by Mayor Dario Hrebak, reduced the surtax from 12 percent down to 9 percent last May, and after cutting it even further, down to 6 percent earlier this year, they have abolished it completely since last month. Starting on May the 1st, 2020, the municipality of Dugopolje also decided to abolish surtax, surtax there stood at 8 percent until that point in time.

A month ago, the local government in Rugvica decided to make a similar move, where the surtax rate within income taxation was 6 percent until relatively recently. Sinj then completely exempted its citizens from surtax at the rate of 8 percent.

According to the Tax Administration, the same was done by the Belica (Medjimurje), which, until this year, charged a symbolic 1 percent surtax. Promina in the Drnis region (inland Dalmatia), has had its 5 percent surtax abolished since back in February.

These are just a few of the areas of Croatia in which local governments have decided to take the pluge and redice the fiscal burdens on their citizens in the coronavirus era, there are others which could be added to this list and it’s likely that more will follow.

This is, at least to some extent, a question of the structure of the economy and of employees, ie, the average level of wages and the share of those who are outside of the tax man’s scissors. For the authorities in smaller cities, the policy of the abolition of surtax can also be an instrument for attracting the population and entrepreneurial activity.

Thus, Dario Hrebak of Bjelovar recently said that there should be no fear that reducing taxes will cause a loss in revenue. Back in March, the first month of the coronavirus crisis, they earned half a million kuna more than in the same month last year. Increasing consumption and getting rid of surtax creates, he says, yet another new activity.

For more, follow our business page.

 

Subscribe to our newsletter

the fields marked with * are required

Email: *
First name:
Last name:
Gender:	Male Female
Country:
Birthday:	[DD] 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 [MM] 1 2 3 4 5 6 7 8 9 10 11 12 [YYYY] 1924 1925 1926 1927 1928 1929 1930 1931 1932 1933 1934 1935 1936 1937 1938 1939 1940 1941 1942 1943 1944 1945 1946 1947 1948 1949 1950 1951 1952 1953 1954 1955 1956 1957 1958 1959 1960 1961 1962 1963 1964 1965 1966 1967 1968 1969 1970 1971 1972 1973 1974 1975 1976 1977 1978 1979 1980 1981 1982 1983 1984 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023

Please don't insert text in the box below!