Croatia VAT increase in 2012 from 23% to 25%

31 December 2011

The Croatian government has agreed to a 2% VAT rise in the standard rate to 25%.  The implementation date is set for 1 March 2012.

Croatia is anxious to reduce its sovereign debt levels, and to secure lower borrowing costs in the face of the latest global economic crisis.  It is anticipated that the VAT rise will be confirmed in January 2012, and will be implemented in March 2012.

There is also a plan to introduce a range of reduced VAT rates, to be levied on socially sensitive goods such as food and medicines.  Alternatively, these goods may be set at zero VAT for the present.

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