Friday, 18 November 2022

A Week in Croatian Politics - Taxes on Taxes, Drones and Spanish Royalty

This week in Croatian politics, we've had everything from Spanish royalty visiting the country for the very first time to Milanovic insulting the foreign minister, missiles hitting Poland, complaints about taxes being put on taxes and still not actually knowing who dropped a drone on Zagreb back in March.

PM Andrej Plenkovic meets the Spanish king

Andrej Plenkovic met with the Spanish king during the very first visit of the Spanish royals to the Republic of Croatia this week. King Felipe VI of Spain and Plenkovic sat down to discuss economic cooperation, the ongoing energy crisis, migrant policies and Croatia's imminent entry into the Schengen area.

As stated, this was the Spanish royal couple's very first official visit to Croatia, and Plenkovic pointed out that the visit is "a pledge to further strengthen bilateral relations with Spain at all levels, with a special emphasis placed on on cultural, educational and scientific exchange".

A Memorandum of Understanding was also signed between the Croatian Ministry of Science and Education and the Spanish Ministry of Science and Innovation on cooperation in the creation of the DONES Programme, which envisages a partnership between Croatia and Spain in fusion research.

"Projects like this are an opportunity for further cooperation between Croatian and Spanish companies in the high-tech and scientific sphere, they also represent the improvement of economic relations," the press release on the matter stated. Plenkovic was quick to thank King Felipe for Spain's ongoing support in Croatia's entry into Schengen, which is set to occur on the 1st of January, 2023, the same date on which Croatia will officially adopt the euro as its currency.

The pair also discussed current challenges such as the energy crisis caused by Russian aggression against Ukraine and the bloc's migrant policy, which requires a unique European response, as well as the role of the EU in Latin America and in the Western Balkans.

The Croatian Employers' Association (HUP) claims the new tax which was proposed recently will further discriminate against certain companies and work to punish the most successful

''We're shocked by the government's proposal for a new profit tax because it's discriminatory and puts the most successful companies in Croatia at a disadvantage. This is actually the dishing out of a punishment to the most successful companies in this country, the companies that fill the state budget the most, employ the most people, pay the highest salaries and invest the most," said the Croatian Association of Employers, reacting to the introduction of the new profit tax.

"Companies operating here in Croatia don't have extra earnings, this year's profit barely covers losses from previous years, and it's completely unclear as to why the government is doing this. Ahead of us lies a crisis and recession, the depth of which we don't yet know. What we know is that Croatian companies are cancelling orders left, right and centre and that now we need the strength to survive the recession and let people keep their jobs," they warned from HUP.

"This is a proposal to introduce a tax on taxes, which will certainly stop investment in development, which means that there will be no new jobs or salary growth, and we're once again becoming an unsafe country for business and looking unattractive to investors. Along with Hungary, we're the only country that spreads the tax across the entire economy instead of, as prescribed by the European Commission Regulation, keeping it exclusively to the energy sector, which made an unexpected profit thanks to market disruptions caused by the war in Ukraine," announced HUP.

"HUP cannot support the unjustified discrimination of large companies that this proposal brings. On top of that, this tax cannot be introduced retroactively for the year 2022, when investment and employment plans have already been implemented. This proposal will unjustifiably penalise the most successful Croatian companies, the best employers and the largest investors who and they pay the most into the state budget," said Irena Weber, CEO of HUP.

Instead of introducing yet more new taxes, HUP very concretely advocates a full tax reform and stronger work relief through an increase in the personal tax deduction and a reduction in income tax rates. This is the way to strengthen the economy, attract new investments, increase wages and create new jobs, according to them.

Milanovic and King Felipe talk politics while their wives talk healthcare and the prevention of obesity in children

King Felipe VI of Spain and Croatian President Zoran Milanovic are both satisfied with the bilateral relations between the two European countries, while their wives emphasised the importance of preventing obesity in children for preserving the health of the entire population, according to the press releases published after their meetings in Pantovcak.

The Spanish king was on a two-day official visit to the Republic of Croatia together with Queen Letizia, and after the ceremonial reception at Pantovcak, President Milanovic and his wife Sanja Music Milanovic spoke with the royal pair. The Spanish king and the Croatian president both stated that they are satisfied with the bilateral relations between Croatia and Spain, which are two friendly and allied countries, members of the European Union and NATO.

King Felipe and Milanovic also referred to the close scientific cooperation between the two countries, which is particularly marked by the joint partnership in the aforementioned DONES programme, which the Spanish king also discussed at length with Plenkovic.

The meeting also discussed current European and global topics, including the security crisis in Eastern Europe caused by Russian aggression against Ukraine, while their wives discussed the importance of preventing obesity in children.

Sanja Music Milanovic and Queen Letizia of Spain separately discussed innovative approaches to obesity prevention in children in Croatia, Spain and the entire continent. The importance of obesity prevention in children for preserving the health of the entire population was emphasised and the importance of a comprehensive approach to obesity prevention through a multisectoral set of interventions aimed at all periods of life was emphasised, the press release on the topic stated.

Music Milanovic presented the professional and scientific activities she carries out in this area in Croatia and Europe and announced the upcoming inaugural summit of the spouses of European leaders on the topic of childhood obesity prevention across Europe, which she will jointly organise with the European Office of the World Health Organisation (WHO).

The King and Queen of Spain were, as stated, on their very first official visit to Croatia during the year which marks the 30th anniversary of the establishment of diplomatic relations between Croatia and Spain, all with the aim of confirming exceptionally good bilateral relations and providing incentives for their further development.

Croatian authorities still don't know who launched the six-tonne drone which hit Zagreb eight months ago

As news broke about an alleged Russian missile having crossed over into Polish territory, killing two people, our memories return to the drone which struck Zagreb eight months ago. It turns out that the powers that be still have no idea who launched the mysterious drone which crash landed and ended up in pieces. 

The Russians are still claiming that the drone which struck Poland had nothing to do with them, saying all those who are claiming it to be Russian are just trying to provoke. Still, we were all shocked and we went from speculating about a Russian attack on Poland, a NATO country, to thinking about the possibility of a third world war to, what is now increasingly likely, finding out that the missile was in fact Ukrainian.

As a reminder, two people were killed after, as Polish authorities then said, a "Russian-made projectile" fell near the village of Przewodow, about 6.4 kilometres west of the Polish-Ukrainian border, around the same time that Moscow forces launched their largest wave of missile attacks on multiple Ukrainian cities in more than a month.

The circumstances of the incident, including information about who fired the missile and from where it was fired, were unknown, which caused possible speculation about Russian involvement in the event and expectations of NATO's next step following the apparent striking of Poland, a NATO member state. But according to US officials, initial findings suggest that the missile that hit Poland was actually fired by Ukrainian forces at an incoming Russian missile.

Three officials told the Associated Press (AP) news agency that the Ukrainians were trying to defend themselves against Russian fire aimed at their electrical infrastructure. This is the event that reminded us of the incident that happened on March the 10th right here in Zagreb, just two weeks after the start of the Russian invasion of Ukraine. Then, a strange Soviet-made Tu-141 unmanned aircraft crashed in Zagreb near the "Stjepan Radic" student dormitory. During the fall, the unmanned aircraft crashed into the ground, leaving a crater behind it.

The circumstances behind it all are still unclear, so Index asked DORH recently if it had ever actually been established who had sent that drone into Croatian territory.

"On April the 13th, 2022, the County State Attorney's Office (DORH) in Zagreb, in the presence of experts, held a press conference where they reported on the results of the investigation related to the crash of the drone.

''At the aforementioned press conference, it was stated that the answers to the questions about where the [unmanned] aircraft came from and whose aircraft it was are under the jurisdiction of other bodies, and not under the jurisdiction of the State Attorney's Office," the answer reads. As for the press conference that DORH mentions in the answer, it was said that the drone had Ukrainian colours on it, but also that it was carrying a bomb. "It was undoubtedly established that it was fragments of an OFAB 100-120 aerial bomb," Major Mile Tomic said in a DORH press release back in April, adding that a lighter was also found.

"During the impact, an explosive device did explode, as was evidenced by the creation of a large crater, the scattering of earth and stones, the ejection of fragments from the crater, as well as traces of tearing and hardening of the metal parts of the bomb," said Ivana Bacic, a chief fire and explosion expert.

"The original aerial bomb should contain 40 to 46 kilos of TNT military explosive, which would be characterised by blackening," Bacic noted.

The Zagreb drone incident could therefore have had horrendous consequences, and yet it seems we're none the wiser. By sheer luck, a real tragedy was avoided. When people say the word 'drone', to many people it sounds like a plastic toy or indeed a type of worker bee, but in this case we're dealing with something that weighs six tonnes and was carrying an explosive on it. It fell in the immediate vicinity of the student dormitory and what could have happened doesn't bear thinking about. In spite of all of that, it is still not known who the drone belonged to, how it was launched, or and why.

Back at that time, the drone event stimulated two debates. First, the question arose as to how much protection NATO provides to Croatia in general.

Before entering Croatian territory, the drone flew over two NATO member states, Hungary and Romania, only to crash in the third NATO member state, Croatia, after seven minutes of flight. In those seven minutes, no one reacted, neither the Armed Forces of the Republic of Croatia nor the Directorate of Civil Protection. NATO did nothing either, and all that lack of action in the then very fresh situation of the shocking Russian invasion of Ukraine and the outbreak of war here in Europe once again.

"NATO's integrated air and anti-missile defense followed the flight path of the object that subsequently crashed in Zagreb. The Croatian authorities have announced that they are investigating this incident," said a NATO official at the time.

Second, in parallel with the investigation, there was a debate about whether the drone really had a bomb on it or not. Defense Minister Mario Banozic and Prime Minister Andrej Plenkovic claimed that there was an explosive device in the drone, while a number of experts disputed this. President Zoran Milanovic was also skeptical about the presence of a bomb in the drone, and he was quick to reproach Plenkovic and Banozic for stoking fears.

Even NATO Secretary Jens Stoltenberg entered the discussion about the explosive device on the drone, and he stated at a press conference that the drone was unarmed. After that, another press conference was called by Prime Minister Plenkovic, who denied his claim, along the way showing photos of parts of the drone that he said belonged to the bomb.

As stated, despite the severity of this incident and all of the potential reasons behind it which are extremely concerning to think about given Russia's actions and the ongoing war over in Ukraine, nobody seems much more in the know then they were back on March the 10th.

Foreign Minister Gordan Grlic Radman says that we will not be training Ukrainian soldiers on Croatian territory

If you recall, Zoran Milanovic was among the loudest in his opposition to this idea, and it seems he is far from alone in his thoughts that supporting Ukraine should be as far as Croatia goes, as we don't want to bring the war to our doorstep. 

"I'm absolutely not going to give my consent. Grlic Radman went to Brussels without my prior consent. There are enough of Plenkovic's mini ministers going up to Brussels without the prior consent of the commander-in-chief, and it isn't going to carry on that way. Grlic Radman is nobody and nothing, Plenkovic is actually important here, but he went and pushed himself to the front row like a dumb nerd,"  Milanovic said about the Minister of Foreign Affairs, once again using another opportunity to sling mud and throw insults around.

Grlic Radman also said later today that there will be no training of Ukrainian soldiers in Croatia, and he remained polite and professional in his wording.

"What Croatia can offer, it will offer. Is it the training of Ukrainian soldiers on our territory? No, no it isn't, it will be on the territory of some other EU member states that have offered. However, the countries in which that might take place still haven't been determined,'' Grlic Radman said in an interview with RTL Danas/Today.

 

For more on Croatian politics, make sure to keep up with our dedicated section and keep your eyes peeled for our Week in Croatian Politics articles which are published every Friday.

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