ZAGREB, September 28, 2018 – Even though it welcomed the planned reduction of the standard VAT rate for some food products, the parliamentary opposition on Thursday criticised the government’s tax reform proposal, saying that the planned tax cuts were too small and would not be felt by the poorest citizens.
The proposed amendments to the VAT Act as of 2019 envisage expanding a reduced, 13% VAT rate to include, children’s nappies, meat, fish, fruit, vegetables, and eggs, as well as reducing the standard, 25% VAT rate to 24% as of 2020.
Croatian Peasant Party (HSS) leader Krešo Beljak welcomed the lower VAT rate on meat, fruit, vegetables and eggs but also called on the government to adopt a regulation to make retailers cut food prices to make them acceptable also to the poorest.
Another HSS MP, Davor Vlaović, called on the government to also reduce VAT on the Slavonian kulen salami and other sausages, to which Finance Minister Zdravko Marić said that for the time being no VAT reduction was envisaged for meat products, but noted that “VAT on (minced meat product) ćevapčići has been reduced.”
Social Democrat MP Marko Vešligaj said that the HDZ had gone back on one of its main pre-election promises – a reduction of the standard VAT rate from 25% to 23%.
Tomislav Panenić of the MOST party said that nobody would buy more fruit or vegetables over reduced VAT and that the lower VAT would not result in a significant increase in spending, without which, he said, there could be no rise in output and employment either.
Panenić added that he nonetheless hoped retail chains would acknowledge VAT reduction and cut their prices.
