ZAGREB, November 3, 2019 – Finance Minister Zdravko Marić said on Saturday that both monthly and annual income tax calculations for young people were good models and that the most important thing was that young people would feel the tax cuts.
“We’ll see how the parliamentary debate (on the government’s tax relief proposal for young people) goes. The original proposal was to calculate reduced income tax monthly, but after the comments we received during the public consultation from young people, accountants, employers and others, we opted for annual calculation,” Marić told Hina.
He was commenting on media reports that people under 30 will receive high wages because of tax relief only as of August 2021.
He said the proposal to cut income tax by 100% for people under 25 and by 50% for those aged 26-30 elicited great interest already during public consultation, when the bill said the cut would be calculated monthly.
But the bill the government eventually sent to parliament envisages annual calculation. “We believe the result of the measure is better and more effective with annual calculation,” Marić said, adding that “both models have pros and cons” and that the government was open to discussion.
“If you opt for monthly calculation, you have a slightly higher monthly pay and slightly higher creditworthiness… Annual calculation makes it possible for the person to get the full amount during the calculation,” he said.
More tax news can be found in the Business section.