Taxation in Croatia
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Related on Lably
Through Income tax, Welfare spending and Value-added tax
Income tax
Income tax is determined by the amount of income and place of residence. The tax is levied at a lower or higher rate defined by the government and determined by the local government unit. The threshold between the lower and higher rates is set at an annual income of €50,400 equating to a monthly income of €4,200.
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Value add tax
Value add tax (VAT) is levied at three different rates. The standard rate is 25%, two reduced rates are 13% and 5% apply on different goods and services. The 13% rate apply for newspapers, magazines, bread and milk; books and scientific journals, hotels and medicines.
Employment income tax
Employment income is subject to social security, at a rate of 16.5% for the employer and 20% for the employee.
Corporate taxation
Corporate tax depends on the revenue the company earns.
Certain expenses are tax deductible for businesses including personal means of transportation. Resident businesses are taxed on worldwide income, while foreign companies in Croatia are taxed on profits earned in Croatia.