Why Do Foreign Investors Avoid Croatia?

Total Croatia News

Some other countries have a much more favourable tax systems.

If I can make it in Croatia, I can make it anywhere in the world! This is the slogan of foreigners who have started their businesses in Croatia, says economist Ante Babić. But seriously, one could say that it has become easier now to launch a business in Croatia compared to several years ago. It used to be much more difficult, but all you need to do now is go to hitro.hr and spend one to five days on the procedure which costs from 105 to 670 euros, reports Poslovni.hr on August 15, 2016.

“According to foreign investors and entrepreneurs, it is so hard to perform business operations here that the saying ‘who manages to do business here will succeed anywhere else in the world’ rings true. The point is that the Croatian government and institutions have a schizophrenic role; they would gladly take money from businesses at every step and suck the life out of them. We even have the Ministry of Entrepreneurship and, what is even more hypocritical, promotional campaigns have been launched to invite people to enter into entrepreneurship. It is such a fake intention. When you start a private limited company with 20,000 kuna, during the first year of operations you will spend a great deal of money for accounting services and the like, without one lipa in turnover”, says Babić.

In the meantime, some more sensible countries, such as Germany, Switzerland, Lithuania, Slovakia and Ireland, have a much more favourable tax system for entrepreneurs. In Germany and Switzerland, for instance, businesses with a turnover of one million euros a year or less have to submit an annual handwritten report, and if they do not want to have an accountant that is fine. No one will bother them, explains Babić. And why? Because taxes obtained from companies earning less than one million euros a year will definitely not save the state budgets of countries such as Switzerland or Germany that have special teams for 100, 200 or 1,000 largest companies which they monitor on a daily basis.


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