Net Salaries in Croatia to Increase Starting from 1 January

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Finance Minister Marić announces changes to tax system.

Finance Minister Zdravko Marić announced important changes in tax system which will take place over the next few years. Marić also spoke about the increase in net salaries from January 2017, reports on October 22, 2016.

“You know that the idea was from the very beginning to implement a complete, comprehensive reform. Income tax is just one of several segments. That is what we have already said earlier, and we will certainly do it. So, for those with highest incomes, who pay the highest marginal tax rate, there will certainly be some changes. But we want to protect social equality and there will be changes in other segments as well. You know that I as Finance Minister certainly will not jeopardize the budget and our public debt policies. Therefore, everything in our projections can be implemented as early as 2017. We will try to make it work so that this change can be felt by the vast majority of citizens. As for the income tax, at present some 915,000 citizens do not pay anything. With these changes, that number will increase to a million and a half people”, he said.

“People who do not pay income tax will be able to feel the difference in some other segments, like for example in the VAT system, which will result in an increase of their disposable income. As far as the general rate of VAT is concerned, we are not going to change it in the first year”, continued Marić.

He talked about possible increase in net salaries. “We have over sixty different scenarios which we have prepared. We have found the final solution, and we will present it to the government on Monday. If it is adopted, then we will announce the details. There will be changes in tax bands and in tax rates, and it is certain that the majority of people will feel it as an increase in their salaries”, said Marić.

According to unofficial calculations, starting from 1 January, those who earn 5,000 kuna a month could see their salaries increase by about 100 kuna. Those who earn 5,800 kuna, can expect to get an increase of about 200 kuna. Those with salaries of around 9,000 kuna should get about 300 kuna more, while those who earn more than 15,000 kuna will receive an increase in their net salaries of about 1,000 kuna.


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