Croatia unveils major tax reform

Croatia is on the brink of a significant tax overhaul, with plans to introduce a comprehensive reform package aimed at providing substantial tax relief to its citizens.

Set to take effect on January 1, 2025, the reform has been announced by Croatian Minister of Labor and Social Policy, Marin Piletic, who emphasized the government's commitment to easing the tax burden on individuals and promoting affordable housing.

A key component of this reform is the introduction of a real estate tax, which represents a strategic shift in Croatia's taxation approach. Unlike previous proposals, the new real estate tax will not merely replace existing utility fees but will employ a different taxation methodology. This tax will apply to all properties not primarily used for housing, broadening the scope beyond vacation homes. The goal is to alleviate the tax pressure on labor by shifting it towards property ownership.

The government has worked closely with social partners, employers, and unions to build consensus around this reform, ensuring that it aligns with the broader objectives of economic growth and social equity. The introduction of the real estate tax underscores the government's focus on making affordable housing a priority during its current term.

As the tax reform package is finalized, it will soon be opened for public debate, reflecting the government's transparent and inclusive approach to policy-making. This major tax reform signals a positive step towards a fairer and more balanced taxation system in Croatia.

Source: https://www.slobodenpecat.mk/en/hrvatska-najavuva-golema-danochna-reforma-se-razmisluva-za-voveduvanje-danok-na-nedvizhnosti/