The Social Democratic Party (SDP) Pedja Grbin on Friday presented a set of short-term and long-term measures that the SDP proposes for a "turnaround to the creation of well-paid jobs in all the branches of Croatia's economy."

“Our economy today depends to a large extent on luck,” the opposition leader said, adding that Croatia is fortunate to be placed on the perfect spot on the globe, to have the splendid scenery, the sun, and the sea.

However, he called for contributing added values such as work, visions and ideas, to all that so as to improve the living standards.

SDP for changing company profit tax system

Some of the short-term measures aimed at raising wages should be conducted through a change of the system of collection of taxes on companies’ profit, rather than through amending the income tax system, which, he said, would contribute to a rise of salaries of those who are already high-income recipients.

Currently, an 18-percent rate is applied for taxing the profit of companies, except micro companies that are exempted from it.

The SDP proposes the reduction of the rate in proportion to the height of salaries disbursed to workers.

If someone invests in their company and raises the wages of their workers, they should be rewarded by lower profit tax rates, said Grbin.

SDP parliamentarian Branko Grcic said that the SDP was for higher windfall taxes on banks, such was introduced by the Italian conservative government.

Grcic warned that one fifth of employees in the private sector earns a net wage below €624.

If there are employers who pay out low wages while their companies earn a solid profit, it is necessary to carry put redistribution (of that profit), said Grcic.

He said that this change of the profit tax system is “indirect subvention of the wage growth” in the private sector.

“This is something which we have not seen yet, but it can function. The measure stimulates employers to raise salaries of their workers and keep them,” he said.

One of long-term measures is giving a boost to investments that create well-paid jobs, particularly in the underdeveloped areas of Croatia and to stimulate green transition.

The SDP advisory board’s chairman Josip Tica said that currently, the economy is creating jobs not interesting for local inhabitants.

In 2022, 100,000 workers from abroad were here plus 40,000 pensioners who worked part time, he said.