Croatian Government Announces Potential VAT Reduction on Fuel
Zagreb – The Croatian government has announced the possibility of reducing the Value Added Tax (VAT) rate on petroleum derivatives, up to ten percentage points, through a regulatory amendment under the revised VAT Act. This move avoids the need for changes to the fundamental legislation. The potential adjustment is contingent upon further escalation of the conflict in the Middle East and subsequent increases in global energy prices.
Currently, the standard VAT rate for fuel in Croatia stands at 25 percent, aligning with European Union directives which permit a minimum VAT rate of 15 percent for fuel products. The announcement follows criticism from the Croatian Parliament, the Sabor, who cited data from the State Statistical Office indicating a 5.8 percent rise in the prices of essential goods compared to April of the previous year. Jelena Miloš, representing the Možemo parliamentary group, expressed satisfaction with the government’s decision.
The government anticipates utilizing this measure solely in response to heightened geopolitical instability and associated energy market fluctuations. The adjustment to the VAT rate on fuel is designed to mitigate potential price increases for consumers.
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