Coronavirus

Tax and other measures to mitigate Coronavirus (COVID-19) effects

Božica Bukovski SupancBožica Bukovski Supanc

Government published Acts in the Official Gazette enabling the implementation of measures to help economy recover from the coronavirus epidemic.

The main objective of these measures is to preserve jobs and salaries.

Tax measures

  • postponement of payment and/or payment of tax obligations, mandatory contributions and certain non-taxable duties in installments, whereby no default interest will be imposed during postponement of payment/payment in installments and no statute of limitation;
  • receipts in form of state grants to individuals and companies for mitigation of special circumstances caused by the coronavirus will not be considered as taxable for personal/corporate income tax purposes;
  • the amount of the determined personal income tax and city tax to personal income tax will be paid onto the citizens' accounts upon delivery of the tax resolution (by keeping deadline for the right to object), while the deadline for payment of the determined difference of personal income tax and surtax to personal income tax remains unchanged; 
  • employers engaged in the production of textile, clothes, leather, wood and furniture are exempted from the obligation of quote employment of disabled persons, starting from 1st April 2020;
  • tourist minister will prescribe a postponement or exemption of payment of tourist tax for taxpayers of this tax;

Liquidity preservation measures:

  • postponement of payment of contractual rent or fee for 2020 for tenants, long-term tenants, concessionaires and users of agricultural land owned by the Republic of Croatia for the period of three months;
  • payment of fixed part of concession fee for 2020 and variable part of concession fee for 2019 to be executed up to 30th November 2020 at the latest;

Measures for direct preservation of jobs:

  • government would secure minimum salaries (3.250 HRK, app. 435 EUR), while difference up to full salary would be borne by the employer;

The implementation of these measures, resp. the manners, deadlines of postponement of payments, terms of payments in installments and similar are not known now and will be prescribed by the relevant ordinances and decisions within the next days.

Also, there are a number of other measures that will be implemented in cooperation with HBOR, HAMAG BICRO and business banks with the aim of liquidity preservation and preservation of jobs, however details have still not been specified.