Croatia introducing Property Tax – what it means for owners

Croatia’s Minister of Finance, Marko Primorac, confirmed at a press conference today following a government meeting that a property tax is set to be introduced.

The minister mentioned that the aim is to equalise the treatment of long-term and short-term rentals.

As tportal reports, he stated that the property tax is planned to be introduced by transforming the existing holiday home tax with all the changes and details presented on Monday.

“The goal is to expand the range of properties that will be subject to the tax, modify the rates, and introduce a mandatory range for taxing such properties. We will mandate that all local government units implement this tax, in line with our objective of shifting the tax burden from labour to property,” Primorac said.

He added that the proposal includes raising both the lower and upper limits for taxation but did not wish to disclose specific figures, leaving that announcement for Monday.

“The property tax will not apply to individuals who live in the property or if it is under a long-term rental agreement. All others, whether individuals or legal entities, who own a property will be required to pay the tax,” the Minister stated.

He also noted that the taxpayer will be determined in March for the current year, and anyone with a long-term rental agreement who rents out the property for at least ten months of the year would not be subject to the property tax.

Primorac also revealed plans increase the threshold of entering the VAT system to 50,000 euros, up from the current 40,000 euros.

We will report more details on Monday once the tax is presented.