Further Tax Cuts Coming

Total Croatia News

ZAGREB, January 26, 2018 – Finance Minister Zdravko Marić said on Friday that a year after the application of first tax reform measures, one could definitely say this was a step in the right direction and that enough room has been created for further tax, administrative and non-tax relief.

Significant results have been made not only in tax collection, but also in tax, non-tax and administrative relief, which is great for taxpayers, Marić said at the First Tax Conference, organised by the Zagreb School of Economics and the Deloitte company.

The Minister said that significant progress made in the overall public finances management has helped reduce the budget to the level “where we spend as much as we make and for the first time we have recorded a surplus in the general government budget.” He added that all of this additionally encouraged the government to continue on the path of tax, administrative and non-tax relief.

Marić stressed additional analyses of the tax system would be made in 2018 to summarise the results of the tax reform and rectify possible omissions. Asked about possible changes in the direct and indirect taxes, including Valued Added Tax (VAT), Marić said space has been created for this issue to be addressed, adding however that he would refrain from making any specific announcements.

The Finance Minister said VAT in Croatia was absolutely and relatively the highest tax form and that the state collects 55% of its total tax collections through VAT.

Economy and SMEs Minister Martina Dalić said the objective of the government and the entire economy was to have an efficient tax system that could be implemented simply and fairly and which could generate sufficient revenues for the state budget.

The reduction of VAT rate has been HDZ’s main preelection promise ahead of parliamentary elections both in 2015 and 2016, but has since been turned for a certainty into a possibility.


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