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Croatia’s Ministry of Finance has created a working group to draft a new property tax law, according to the daily newspaper Vecernji list.
Croatian Finance Minister Slavko Linic believes the new tax law will be ratified by Parliament in the fall and enforced in early 2013.
The property tax will replace the primary source of income for the government, which is presently the utility fee.
The tax will be dependent on the value of the property and its use. Citizens will be taxed more heavily if their property is of higher value.
According to the government, the tax will not greatly affect individuals who live in the property they own. The bill is targeted towards citizens who do not reside on their property or own land that is unused.
The bill will be available for public debate before the summer.
To keep its reform policy credible for investors, the government must find common ground with the IMF and look for a new arrangement, experts say.