Budget Revenues Higher than Last Year

By , 18 Mar 2017, 13:20 PM Business

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Finance Minister Marić is satisfied with budget revenues and expenditures.

Croatian Finance Minister Zdravko Marić said on Saturday that the tax revenues in the first two months of this year reached 10.4 billion kuna, or 1.3 percent more than in the same period last year. He also discussed the introduction of property taxes and the latest events concerning Agrokor, Croatia’s largest privately-owned company, reports Jutarnji List on March 18, 2017.

According to preliminary data, the total budget revenues in the first two months of this year amounted to 17.6 billion kuna, while tax revenues reached 10.4 billion kuna, which is 1.3 percent more than in the same period in 2016, said Marić. “Revenues from VAT have increased by 1.8 percent. It should be remembered that from 1 January we have lowered VAT rate on electricity and garbage collection, but at the same time we have reintroduced VAT on catering services. However, the real effects will be seen in the coming months”, said Marić. He also said that there was a decrease in revenues from excise taxes on tobacco and tobacco products, which is the result of the reduction in cigarette consumption due to increase in excise duties, as well as anti-smoking campaigns. Marić also pointed out the growth of salary contributions revenue by 3 percent, which is a consequence of employment growth and nominal wage growth.

The expenditure side of the budget is in line with the plans, he said, with expenditures in the first two months in the amount of 19.4 billion kuna, which is 1.1 billion more than in the same period last year. He pointed out that the increase was primarily related to subsidies for agriculture, which were paid as early as February, instead of April as in previous years.

As for 2016, Marić reiterated that the latest preliminary data showed that the general government deficit was at the level of 1 percent of GDP, which is lower than the planned 1.6 percent.

The Minister also pointed out that property taxes would be introduced on 1 January 2018, as a substitution for utility services fee. “In order to successfully implement the introduction of property taxes, the Finance Ministry and the Tax Administration are in intensive collaboration with the Association of Towns and the Association of Municipalities”, said Marić.

He also announced another important project – solving the problem of citizens with frozen bank accounts. According to data, there are 327,000 such citizens, and their total debt is 40.2 billion kuna. “Prior to elections, we promised that we would write off citizens’ debts in the amount of one average salary. We will fulfil that promise”, said Marić.

Marić also commented on the latest events with Agrokor, Croatia’s largest privately-owned company. “We know that they are trying to find a model to increase liquidity in order for Agrokor to regularly pay its obligations. We expect that the owner of the company and the creditors will agree on all important aspects relevant to the company's operations” said Marić.

He again denied reports that Agrokor did not pay 800 million euros in the value added tax. “I can only confirm that Agrokor does not enjoy any privileged status and that legal measures are being taken for the full and timely payment of tax liabilities”, said Marić.

Data from the financial statements of Agrokor for the first nine months of last year, published on the website of the group, show that the total long-term liabilities amounted to almost 20.3 billion kuna, of which almost 19 billion kuna were loans. As for short-term liabilities, which totalled 24.9 billion kuna, the most largest part included debt to suppliers, which reached 16.2 billion kuna.

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