The newly 2018 national reform programme does not contain plans to introduce a property tax, and a new set of measures designed to ease the tax burden wil be prepared by summer, Finance Minister Zdravko Maric told reporters after attending government's session on Thursday.
“(Introducing) property tax is currently not on the agenda, and especially not in the form of a value-based tax,” Maric said in a news conference following a government session in which the national reform programme was approved earlier in the day.
Asked about plans on introducing real estate tax, which had been included in the government’s 2016 reform programme, Maric said that although there had been a lot of debate in the public over the planned introduction of real estate tax over the past two years, the tax was eventually dropped from the Convergence Programme, and was meant to be replaced by an upgraded system of public utility fees, collected by municipal authorities.
“After all those discussions, the real estate tax is no longer on our agenda, and we believe that the measures in the new national reform programme could upgrade the public utility fees system, which might be a bit old-fashioned method, and we’ll see if this upgrade happens,” Maric said.
Maric said that easing the tax burden is in the works, and that a copmprehensive set of measures would be prepared by summer. Maric was asked if this would involve reducing the VAT rate. In the European Union, only Hungary has a VAT rate higher than Croatia, at 27 percent, with Croatia, Sweden, and Denmark each collecting the second-highest VAT rate at 25 percent.
“We have a fiscal policy framework in which we are not looking how to spend the surplus revenue, but how to ease the burden on the economy instead. However, the details of the tax plan have not been decided yet. I would not oppose reducing the VAT, but we will look into all options available, and we will present a full set of measures by summer,” Maric said.