ZAGREB, Jan 1 (Hina) - As of January 1, a package of new tax laws becomes effective in Croatia. The most important things which come with enforcement of new laws are the introduction of three rates for the income tax, a cut of the
profit rate tax to 20 percent and an increase in excise duties on cars. As of the very first day of 2001, five (5) acts take effect, and those are the general taxation law, the law on taxation counselling service, the income tax law, the profit tax law and amendments to the act on excise duties on personal cars. There will be three rates for the tax on income. The income up to 2,500 kuna per month will have the 15-percent tax rate. The monthly income between 2,500 and 6,250 kuna will have the 25-percent tax rate, whereas 35-percent tax rate will be applied for incomes higher than 6,250 kuna. The 15-percent income tax should be paid for the income from capital, dividends and a portion in t
ZAGREB, Jan 1 (Hina) - As of January 1, a package of new tax laws
becomes effective in Croatia.
The most important things which come with enforcement of new laws
are the introduction of three rates for the income tax, a cut of the
profit rate tax to 20 percent and an increase in excise duties on
cars.
As of the very first day of 2001, five (5) acts take effect, and
those are the general taxation law, the law on taxation counselling
service, the income tax law, the profit tax law and amendments to
the act on excise duties on personal cars.
There will be three rates for the tax on income. The income up to
2,500 kuna per month will have the 15-percent tax rate. The monthly
income between 2,500 and 6,250 kuna will have the 25-percent tax
rate, whereas 35-percent tax rate will be applied for incomes
higher than 6,250 kuna.
The 15-percent income tax should be paid for the income from
capital, dividends and a portion in the profit.
On the other hand, outflows such as the paid premium for the life
insurance and payment for additional health and pension insurance
up to 1,000 kuna will be recognised as expenses in the calculation
of the amount which should be paid as tax.
Under the new income tax law, a greater number of earnings will be
tax-free, costs for the purchase of equipment and a part of costs
for business entertainment funds will be recognised, and the
protective interest rate and the obligation of value assessment
will be revoked.
The most important novelties in the taxation of the profit are the
reduction of the tax rate from the current 35 percent to 20 percent
and the annulment of the protective interest rate.
According to the new act, tax facility will be the recognition of
donations and grants for cultural, scientific and scholarly
institutions, humanitarian agencies, sports clubs and other
associations, the amount of which is up to two (2) percent of the
profit in the previous year. The 30 percent of expanses for business
fund entertainment funds will be viewed as the tax facility.
Tax facilities include stimulation for investment and job
creation.
As of January 1, cars will be more expensive owing to the new
increased excise duties on vehicles. Besides, the excise duty will
be applied for cars which have to date be exempt from them. The tax
base remains the purchase price, while the lowest excise of five (5)
percent will be paid for cars worth up to 50,000 kuna. The next
category - cars between 50,000 and 100,000 kuna - imply the excise
duty of 2,500 kuna plus 10 percent to the amount above 50,000 kuna.
Buyers of cars between 100,000 and 150,000 kuna will have to pay
7,500 kuna of the excise duty plus 15 percent for the amount above
100,000 kuna, and so on. The more expensive car, the higher excise
duty and additional percentage.
(One US dollar is approximately 8.2 kuna)
(hina) ms