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Finmin says gov't to mull reduction of contributions

ZAGREB, April 23 (Hina) - Croatia's tax revenues rose 10 percent last year from 2005 and the Government is going to look into possibilities of cutting contributions provided that the trend of good collection of taxes continues this year, Finance Minister Ivan Suker said at an international round-table discussion in Zagreb on Monday.
ZAGREB, April 23 (Hina) - Croatia's tax revenues rose 10 percent last year from 2005 and the Government is going to look into possibilities of cutting contributions provided that the trend of good collection of taxes continues this year, Finance Minister Ivan Suker said at an international round-table discussion in Zagreb on Monday.

The minister added that contributions made up the lion's share, that is 90 percent, of all burdens set on the gross salary of employees, and taxes cover 10 percent of the burdens.

However, budgetary expenditure, including spending on pensions and health care, was still 15 billion kuna higher than the contributions paid for these purposes, Suker said.

The minister commented on some requests for the introduction of flat tax.

Flat tax proponents forget that this would mean that the Value Added Tax zero-rate on bread, milk, medicines and orthopaedic aids must be abolished, he said.

The round table, organised by the Zgombic & Partners company, Vecernji List newspaper and the Austrian Foreign Trade Office, was opened by the head of the Croatian Chamber of the Economy, Nadan Vidosevic, who also recommended that the tax system should not be changed as stability and predictability for the economy were the most important things.

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