Croatia expects steady Growth, lower Taxes in 2019

November 11, 2018 11:00 AM

The Croatian government on Friday sent to the parliament a revision of this year’s state budget as well as budget proposal for 2019, expecting steady growth and lower taxes next year.

The budget proposal for next year was made on the assumption of 2.9 percent gross domestic product (GDP) growth. State budget revenues are expected to be 136.1 billion kuna (20.8 billion U.S. dollars), 5.5 percent more than this year. Expenditures are set at 140.3 billion kuna (21.4 billion U.S. dollars), 5.7 percent more than this year. Apart from the Ministry of Tourism, all ministries would have a bigger budget in 2019.

Croatian Prime Minister Andrej Plenkovic expressed satisfaction at the government session that the European Commission has raised its economic forecast from 2.6 to 2.8 percent for Croatia’s GDP growth.

“We expect that growth in 2019 will be 2.9 percent and that the revenue side of the budget is based on the growth of economic activity, but also on the third stage of our tax reforms aimed at reducing the tax burden on citizens and companies,” Plenkovic said at the televised session.

Apart from the state budget proposal, the government sent to the parliament on Friday another package of tax relief bills, which include a lower VAT rate on prescription drugs as well as on over-the-counter drugs and a rise in the tax-free amount of annual bonuses for employees.

There will also be a VAT cut, from 25 percent to 15 percent, on foods such as fresh meat, fish, fruit and vegetables. Finance Minister Zdravko Maric said he hopes to see some price corrections because of that measure.

(Source: Xinhua)

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