Tax Burden in Croatia Increases Slightly

Total Croatia News

With the tax reform in 2017, the tax burden should finally decrease.

Croatia’s share of taxes in gross domestic product (GDP) in 2015 was slightly increased, with taxes on production and imports having the largest share in the total tax revenues, according to the latest data from Eurostat, reports on November 26, 2016.

In Croatia, the share of all taxes in GDP, which is the sum of taxes and net social contributions considered as a share of GDP, increased in 2015 to 37.6 percent, from 36.8 percent in 2014, according to Eurostat’s report. Eurostat noted that the share of taxes in GDP was “one of indicators of the total tax burden” and that it covered a very diverse array of social security systems in the European Union.

The greatest tax burden expressed in share of taxes and social contributions in GDP was recorded in France (47.9 percent), Denmark (47.6 percent), and Belgium (47.5 percent). The smallest share of taxes in GDP was recorded in Ireland (24.4 percent), Romania (28 percent), and Bulgaria (29 percent).

Among Croatian neighbours, in Slovenia the share of taxes in GDP stood at 37.1 percent, and in Hungary at 39.2 percent. At the EU level, tax burden in 2015 amounted to 40 percent on average.

In 2015, Croatia was ranked alongside Sweden and Hungary in the group of EU countries with the largest share of taxes on production and imports, which include value-added tax, import duties, excise duties, and other taxes on consumption, stamps, contributions on salaries, fees for environmental pollution and similar levies.

In Croatia, the share of such taxes in GDP last year stood at 19.7 percent. In Sweden, the tax burden on production and imports amounted to 22.1 percent, and in Hungary to 18.9 percent. At the EU level, the tax burden on production and imports, expressed as a share of GDP, stood at 13.6 percent on average.

In the category of net social contributions, with the share of 11.9 percent Croatia was close to the EU average. This category includes contributions such as unemployment insurance, maternity benefits, compensation for disability and illness, injuries and other related duties. The highest level of such contributions was recorded by France (18.9 percent), followed by Belgium (16.7 percent), and Germany (16.5 percent). At the EU level, these contributions amounted to 13.2 percent on average.


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