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Post by Madgolfer on Aug 20, 2012 13:43:56 GMT 1
Minister: New property tax to come into force on 1 January 2013 (From the Croatian Times)
Croatia's Minister of Finance has confirmed on the weekend that Croatia will introduce a new property tax, effective from 1 January 2013, reported daily newspaper Jutarnji list.
Slavko Linic has said that the new tax, which will bring Croatia into line with the majority of European countries, will be introduced in three phases and will replace local rates. "We need a year to determine the values of construction and agricultural land, and then we will introduce the new tax in three phases".
Linic, who says that the new property tax will bring Croatia into line with other nations in the EU, says that the it is not a 'money collection' scheme (Yeah right) but something that is needed for Croatia's development as they are set to join the EU.
Minister Linic pointed out that the new tax will be based on the "value of the real estate" and not "per square meter". Linic also stressed that those with unused property would be affected the greatest.
No specific mention of foreigners being hit extra hard but "unused" property and land seems to cover many of us. I am also a bit confused as to how you can once again introduce a new law before you have finished the paperwork needed to send out the bills to people? Sounds very similar to the recent new real estate laws and the agricultural law, all of which are still not ready in reality some 2 years later.
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Post by Valleycat on Aug 20, 2012 14:11:00 GMT 1
Has there been any discussion of what the % will be yet?
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Post by mh on Aug 25, 2012 12:23:01 GMT 1
According to the recent news, leaked to The Zagreb's Morning paper (Jutarnji) from the "trusted government source" with the intention to prepare the nation before the law is finally introduced, 2% annually of the property market value. In any case, uncertainty will further contribute to the price fall. Usually, the politics is played by leaking 2% and announcing 1%, but that is really high! Another good reason to cut the losses and exit the market...
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Post by velebit on Aug 27, 2012 12:36:31 GMT 1
does anyone know if this proposed tax replaces both existing local community taxes (paid quarterly) and existing holiday (weeekend home) home tax (paid yearly) for foreign homeowners? incidentally both of these taxes are levied on a per square meter basis.. a market value basis would substantially increase the tax take..i can imagine the locals not being too pleased about this!!! can anyone point to a goverment website or respected independent web site which explains the tax in more detail?
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Post by Madgolfer on Aug 27, 2012 18:10:38 GMT 1
At the moment the only information is that being issued in various TV and radio interviews etc, no official press releases for now. How can they give details as they have yet to finalize the new law that has already been introduced. A member of HSS did suggest (maybe he knows) the figure of 2% but this is pure speculation at the moment. I have to agree that despite what the finance minister Linic says in trying to assure everyone that the tax will not be excessive, IT MOST CERTAINLY WILL BE MUCH HIGHER THAN THE CURRENT TAXES IT AIMS TO REPLACE. It is evident from the language being used by Minister Linic that the aim is to tax perceived "RICH" people, anyone with big expensive homes, or second homes, or land they do not use, or rental property they do not live in etc etc etc. While it is almost impossible to drain more taxes from people who are already over taxed, the end result could be a land/property grab scenario by the state tax offices followed by cheap auction sell off to those who can afford it. What will happen if they come along and give you a big bill? What will you do if you don't have the money? Borrow it or loose your property? This will effect Croatians just as badly as us foreigners. Difficult times ahead.
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Post by mh on Aug 28, 2012 0:10:52 GMT 1
Existing community taxes are not the taxes in EU sence, they are charges. There is a huge difference between them. It is scary that property tax is a replacement for extremely high income taxes (high even for EU standards), not the replacement for current property taxes/charges.
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Post by Ribaric on Aug 28, 2012 7:00:00 GMT 1
property tax is a replacement for extremely high income taxes. I don't think so mh, income tax is not affected but komunalna is.
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Post by Madgolfer on Aug 28, 2012 8:25:59 GMT 1
property tax is a replacement for extremely high income taxesIts got nothing to do with income taxes mh, this new property tax replaces the current local government tax. (only will be much higher me thinks)
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Post by Madgolfer on Aug 28, 2012 8:31:42 GMT 1
We estimate that there are well over 500,000 individual land plots of various catagories across Croatia and the gov plans to assess all of these before Jan 1st 2013? Without an assessment how can a value be calculated to tax it? Owners self valuation? Perhaps a standardized price per sq M or per acre etc? Maybe they haven't quite thought this through again?
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Post by mh on Aug 28, 2012 12:26:03 GMT 1
Too many questions, too little answers ... Does anybody understands what is the amount a hotel owner pays now? By m2 or by market value it could be huge as many hotels are not permanently occupied more then 250 days - that is a trigger for current property tax?
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Post by Madgolfer on Nov 14, 2012 15:40:54 GMT 1
And this update from the finance minister......
The Croatian government has changed it’s tune on its proposal to introduce a new property tax on all properties and will instead, from the first of April, introduce a new tax that will replace the current local government council and utility fees, in a bid to financially stabilize local government, announced Finance Minister Slavko Linic.
“We have decided not to pursue the tax on property, because we need stability in the banking system, and we did not want to touch the interest, and taxed dividends would affect investors”, said Linic at the EUforija conference.
The new tax which will be introduced on 1 April, will be in line with current council charges. Time will tell when 1 April rolls around how much the new tax will be, as speculation in the media has been rife, but Linic assures the public that there will not be a significant increase.
So; 1) Still no announcement of the percentages/amounts. 2) Introduction delayed until April 1st. 3) Ministers assurance of no significant increase. (Phew! That's all right then) 4) Will the tax be collected by/go straight to central government and then be distributed by them to the counties?
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Post by Madgolfer on Nov 14, 2012 15:46:38 GMT 1
And this from the prime minister.....
Prime Minister Zoran Milanovic said in Parliament on Wednesday morning that criticisms that the proposed real estate tax would further burden citizens were unfounded.
"This is not a tax on residential property or on the middle class or on those people who took years to build their holiday houses", he said.
"The primary aim is not to introduce a tax that exists in all EU countries, but to bring in some order and transparency", he said responding to queries put forward by MPs during Question Time in Parliament.
He stressed that property where people live would not be taxed.
Martina Dalic of the strongest opposition party, the Croatian Democratic Union (HDZ), claimed that the new tax would certainly lead to economic decline and halt reconstruction or construction of new real estate, leaving construction workers without jobs.
Milanovic added that the time had come for complicated and unpopular but vital decisions, in response to claims by HDZ chief Tomislav Karamarko that the economic situation in Croatia was just getting worse and citizens were being impoverished.
Milanovic argued that the budget deficit had been reduced from 15 billion kuna last year to 10 billion this year and even though this may not be interesting to Croatian citizens it was vital to the country's financial stability.
He explained that the country was facing an alarming situation because public spending was constantly on the rise whereas economic growth was not keeping in step, which called for unpopular decisions.
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Post by Madgolfer on Nov 14, 2012 15:51:05 GMT 1
I cannot seem to match the two statements?
One seems to be saying there is no property tax while the other says that there is but its just not being called a tax on property?
Maybe these two ministers should issue a joint statement to make it a clear as mud.
Roll on 1st April 2013.
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Post by crojoe on Nov 14, 2012 16:02:14 GMT 1
And this from the prime minister.....Prime Minister Zoran Milanovic said in Parliament on Wednesday morning that criticisms that the proposed real estate tax would further burden citizens were unfounded. "This is not a tax on residential property or on the middle class or on those people who took years to build their holiday houses", he said. "The primary aim is not to introduce a tax that exists in all EU countries, but to bring in some order and transparency", he said responding to queries put forward by MPs during Question Time in Parliament. He stressed that property where people live would not be taxed. Martina Dalic of the strongest opposition party, the Croatian Democratic Union (HDZ), claimed that the new tax would certainly lead to economic decline and halt reconstruction or construction of new real estate, leaving construction workers without jobs. Milanovic added that the time had come for complicated and unpopular but vital decisions, in response to claims by HDZ chief Tomislav Karamarko that the economic situation in Croatia was just getting worse and citizens were being impoverished. Milanovic argued that the budget deficit had been reduced from 15 billion kuna last year to 10 billion this year and even though this may not be interesting to Croatian citizens it was vital to the country's financial stability. He explained that the country was facing an alarming situation because public spending was constantly on the rise whereas economic growth was not keeping in step, which called for unpopular decisions. Would this then be like a new council tax which we already pay each month or something added on top? Is it a tax on amount of floor space? I doubt very much it will stop people buying property if they have the money. The real reason why no body is buying or building is because they simply don't have the money anymore and it's probably not worth the rich guys investment as he will get very little return (which is why he invests in the first place). Besides, Europe and the world is in a major recession, not just Croatia. So, any rise in council tax will not stop investment.
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Post by Madgolfer on Nov 21, 2012 10:20:47 GMT 1
And this from yesterdays press.Croatia’s Minister of Finance Slavko Linic has come out and advised anyone with property sitting idle, that they should get rid of it before the new Property Tax Law comes into effect on 1 April 2013. “On property that is not used for any purpose, citizens, business owners, the state and local councils will have to pay the full amount of tax on the value of the property. A message for owners of these properties – Free up the property you do not know what to do with, otherwise it will become an extra burden to you, said Linic, adding that insolvency problems arising from large credit debt occurred because entrepreneurs invested money in real estate, rather than the technology, equipment or human resources. Linic also announced that parliament would debate the new proposed Property Tax Law in the next few months, with all interested parties having a chance to present suggestions. After the debate is over, Croatia will introduce the new tax, which will be based for the first time, on the value of property on 1 April 2013 Read more: visitcroatia.proboards.com/index.cgi?action=display&board=property&thread=9358&page=1#ixzz2CqaqBDiE
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