He noted that the tax on holiday homes is already in force and that many pay it. The purpose of the new tax is to help lower house and rental prices, he said, adding that the government’s activities in the next four years should focus on making housing affordable.

“We do not want to have a generation that cannot afford to have their housing problem solved, so a combination of measures is crucial to achieving that goal,” said Plenković, who was on a working visit to Sisak-Moslavina County.

He said that there was no disagreement in the government regarding the plan for the introduction of real estate tax but that there was caution considering the sensitivity of the topic, which, he said, has caused a lot of concern, misunderstanding and exclusivism in the media.

“On the other hand, everyone expects rental prices to go down. If a young person wants to rent an apartment and leave their parents’ home, but cannot afford it, it means we have a broader problem that we need to tackle through measures to be proposed by the government. The role of local government units is also important in that regard because, as we know, income from holiday home tax is local revenue,” he said.

Last Friday the government presented the seventh set of measures designed to help households and the business sector in the face of price growth, securing slightly less than €248 million for it, and even though government subsidies for electricity and gas prices will stay, prices of electricity and gas will go up, each by 10%, over the next six months, in two turns.

“Minimal increase” in energy prices

As for a reporter’s remark that energy price growth has so far always resulted in the growth of food prices, Plenković said that over the past three years the government had made sure energy prices did not go up, thus protecting social cohesion.

“With our measures we have done our best to help weather this major crisis, which has been going on for three years, more easily,” he said.

“The minimal increase (in energy prices)”, announced last week, is still part of a heavily subsidised government package, worth €250 million, he said.

“These increases are in line with the phasing out of the interventionist measures the government has been undertaking as the sole actor that could help households and the business sector. We have been completely successful in that regard,” he said.

To support his position, he cited positive economic indicators, a 3.9% economic growth in Q1 and a 3.3% growth in Q2, a record-high number of employed persons of around 1.75 million, the lowest ever unemployment, with around 87,000 jobless persons, a record tourist season, and a 1.8% inflation rate in August. There is also the wage growth, Plenković said, adding that as of January 2025 the minimum wage would go up again, without disclosing how much.

He also said that the government had received support from the social partners for its package.

“They all understand that it is as horizontal as necessary while being calibrated to suit the needs of those who need it the most,” Plenković said, recalling that the aid scheme again includes subsidies for pensioners, vulnerable energy consumers, providers of social services, unemployed war veterans, and students.

He repeated that the prices of 30 basic food products would remain unchanged.