ZAGREB, December 11, 2018 – Finance Minister Zdravko Marić said on Tuesday it was too early to speak about a lower VAT rate in tourism sector, which was announced by Tourism Minister Gari Cappelli on Monday, given that the latest round of tax changes had only been adopted.
Addressing reporters ahead of a lecture he was expected to give to students at the Rijeka Faculty of Economics, Marić recalled that the parliament had passed nine laws that would go into force on the first day of 2019, and noted that that was the third round of tax breaks. “All the future steps will be analysed and discussed. I would not make any announcements for the time being,” said Marić.
In a parliamentary debate on three tourism-related bills, Minister Cappelli said that the government would cut VAT on restaurant services in 2020. He said that when asked by Social Democrat Saša Đujić if there was room to lower the current 25% VAT rate on restaurant services to the previous, 13% rate considering that VAT revenues were growing and the economic situation was generally better.
Marić said that VAT as the most abundant budget revenue that puts Croatia at the very top of EU countries in terms of the share of VAT in GDP, definitely created room “for something more to be done in that regard.”
Responding to a reporter’s remark that Cappelli mentioned a lower VAT rate and if his statement meant that the tourism minister did not have the Finance Ministry’s support, Marić said that the government would discuss the matter and that there was plenty of time for that. “I would not want to make any announcements for the time being, it’s too early, we have just adopted the tax laws and they are about to go into force,” said the finance minister.
Asked if he feared that individual VAT cuts could bring into question a cut in the standard VAT rate, Marić said that he did not and that the government would eventually take a unanimous position on the matter.
More news on Croatia’s taxes can be found in the Business section.
