PARLIAMENT COMMITTEES DISCUSS FINANCING OF LOCAL SELF-GOVERNMENT

ZAGREB, June 26 (Hina) - The main subject of today's parliament committee sessions was the final draft amendments to the Law on Financing Local Self-Governments, by which a part of expenses for education, health and special care would be transferred to local levels, and would be applied as of July 1. Explaining the moved amendments at a joint session of the legislature and constitution, rule book and political system committees, deputy economy minister Damir Kustrak said that by introducing the new county taxes, such as taxes on vehicles older than 10 years, and game machines, the county budgets will be filled by additional 237 million kuna (approx. 53 million). He stressed that the possibility of introducing surtax on salary tax in all municipalities is also envisaged. The original participation of municipalities in the salary tax will remain unchanged, and local self-government units will additionally receive a percentage of salary tax for every decentralised function. Another novelty is also that a percentage of the salary taxes will be set aside by the units into the Settlement Fund for less developed areas, from which funds will be allocated according to an accurately determined procedure, Kustrak said. Committee members criticised the fact that the final draft amendments did not consider any of the recommendations the MPs voiced during the first reading. Many MPs opposed the introduction of new taxes and the decentralisation at any cost. The members of parliament today again stressed that the application of the law on decentralisation, which should come into effect on July 1, ought to be postponed. Government members, however, asserted that they would not yield, stressing the decentralisation must begin on July 1, when funds from the budget will find its way into the accounts of local self-governments. (hina) lml sb