PM: Main objective of tax reform is to ease burden on citizens and businesses

The main objective of the government's tax reform package this autumn is to further ease the burden on private citizens and businesses, Prime Minister Andrej Plenkovic said at the start of a cabinet meeting on Thursday.

"We have two major reform packages this autumn - one is tax reform, and the other is pension reform. The latter will be put up for public consultation most likely tomorrow morning. The total amount of tax cuts from January 1, 2017 until the moment the third round of tax reform comes into force will be about HRK 6.3 billion," Plenkovic said.

He said that results on the revenue side of the budget showed that there was room for further tax cuts. "This is the way for sound public finance and the only right way a responsible government can take, and that's why I think the proposed solutions are very good."

He added that the government had decided to reduce the VAT rate as of January 1 from the current 25 percent to 13 percent for products of vital importance for most people, including fresh meat, fish, fresh fruit and vegetables, and nappies. "I think the effects will be very good and positive," the prime minister said.

The government sent to parliament amendments to nine tax laws providing for further tax cuts in the total amount of HRK 2.7 billion. In the first two rounds of tax reform, the tax burden had been reduced by HRK 3.6 billion. 

Text: Hina

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