Croatia’s finance minister on short term tax plans.
Prime Minister Tihomir Orešković and Finance Minister Zdravko Marić held a meeting today with all the ministers in the cabinet and the topic was the budget for this year. Finance Minister Zdravko Marić said that the meeting was just one step in the process of budget planning. “Ministers were given an initial framework so they can begin to prepare their budgets for this year”, Marić said, adding that it was too early to talk about details. “In the next two weeks, we will complete and update the macroeconomic forecasts on GDP growth, inflation, personal consumption and other parameters which will be key elements in the process of planning the revenue side of the budget”, said Marić and added that they had all agreed that this year there will be no changes in taxes, reports Vecernji List on February 2, 2016.
“The emphasis and focus of this meeting and further meetings in the future will be on the spending side of the budget”, said Marić. “The situation in public finances, primarily with regards to the public debt which has grown in recent years, is one of the key and major reasons why the Croatian credit rating is currently two notches below the investment grade”, said the minister and added that we need to “stop the growth of debt, stabilize it and then finally reduce it”.
“Recommendation of the European Commission is that we should as early as this year plan the deficit below three percent of GDP”, said the minister. He asked the ministers to find savings in their ministries which can be achieved in the short term. Marić did not want to go into details about measures which will be used to cut the spending side of the budget, but said that the ministers were also given the task to find where the cuts could be found and to propose structural reforms which could yield results in the long term.
“We will get limits which we will be able to spend this year and we will try to draft a budget which will be both socially sensitive and oriented towards achieving economic growth”, Darko Horvat, Minister of Entrepreneurship and Trade, said ahead of the meeting. Oleg Butković, Minister of Maritime Affairs, Transport and Infrastructure, said that important infrastructure projects will continue. “Infrastructure projects will not be abandoned and must continue”, said Butković.
Finance Minister Zdravko Marić earlier said that the budget will be a demonstration of what the government is planning to do this year and that the government’s objective is to have the deficit reduced to 3 percent of GDP in the next two years. The Minister also announced that all budgetary measures and activities this year will be aimed at slowing the growth of public debt.