Parliament adopts Law on Excess Profit Tax

Zagreb - The Croatian Parliament in an extraordinary session on Friday adopted the Law on Excess Profit Tax, according to which companies with increased profits will become liable for this tax regardless of the business they are in.

A total of 96 MPs voted in favour of the introduction of the "extra tax," and 37 MPs voted against it.

The new levy will be paid by companies with an annual income of more than HRK 300 million in 2022 at a rate of 33%, but only on profits of more than 20% compared to the preceding four-year average.

The tax is of a one-time nature, and the funds collected will primarily go to support end-users of energy, especially vulnerable households. The additional profit tax has an element of solidarity contribution.

Several financial laws were passed, including amendments to the Law on Credit Institutions to ensure that from 1 January 2023, the European Central Bank can supervise credit institutions in Croatia.

The Parliament also passed two laws which, after Croatia became a member of the Schengen Area, create prerequisites for the application of the Schengen acquis communautaire in Croatia, amendments to the law on foreigners and the monitoring of the state border.

Since the entry into force of the Schengen Implementation Agreement, the current Croatian state border with third countries has become the external border of the European Union.

As of New Year, 73 border crossings will be closed

As of 1 January 2023, border controls will be abolished at the Croatian land and sea borders with the Schengen Area countries, Slovenia and Hungary, and from 26 March at the airports.

A total of 73 border crossings to Slovenia (58) and Hungary (15) will be abolished after the New Year.

Author: Hina