The Croatian Entrepreneurs’ Association (UGP) has urged the government to implement a uniform VAT reduction on food products, arguing that high VAT rates contribute to rising living costs and inflation. This call comes amid growing public frustration, with consumer groups organizing boycotts to protest price increases and Croatia recording the highest inflation rate in the eurozone at 4.5% in December 2024.
Croatian Entrepreneurs’ Association Urges Uniform VAT Reduction on Food
Public
Croatia
Author: Ivana Picajkić
Category:
Fiscal subject related
Views:
172
Content accuracy validation date:
05.02.2025
Content accuracy validation time:
08:28h
The Croatian Entrepreneurs’ Association (UGP) has called for a uniform reduction in the value-added tax (VAT) on food products, citing significant price increases that are affecting consumers. This appeal comes in response to consumer protection associations' announcement of a boycott aimed at highlighting high prices and what they perceive as the greed of traders, who they blame for driving inflation.
The call for a VAT reduction has gained support from both opposition and government parties, encouraging Croatian citizens to refrain from purchasing goods in stores, cafes, restaurants, and gas stations on a designated day to protest against unjustified price hikes. The situation is exacerbated by recent data indicating that Croatia recorded the highest inflation rate in the eurozone at 4.5% in December 2024, up from 4.0% in November. Additionally, suppliers have indicated further price increases due to rising raw material costs.
According to the Croatian Statistical Office, sectors such as hotels and restaurants have seen the highest annual price increases, with a 9.6% rise, while services overall increased by 6.7%. Food and beverage prices have also risen by 4.8%. The UGP attributes these escalating costs primarily to high VAT rates on food.
Croatia operates with three different VAT rates:
- 5%: Applies to basic foodstuffs such as bread, milk, eggs, fresh meat, fruits, and vegetables,
- 13%: Covers items like oil, butter, margarine, and baby food,
- 25%: Applies to all other food products not classified under the lower rates.
The UGP argues that Croatia's VAT on food is among the highest in the EU and significantly contributes to rising living costs. They also highlight systemic issues within the country, including labor shortages and low production levels that further complicate economic conditions for citizens.
The UGP's call for a uniform reduction in food VAT reflects broader concerns about affordability and economic stability in Croatia. As inflation continues to impact various sectors, including essential goods and services, the association emphasizes the need for policy changes to alleviate financial pressures on consumers.
Other news from Croatia
VIDA regulation adopted—what does that mean for business?
Public
Author: Nikolina Basić
The EU adopted the VAT in the Digital Age (ViDA) package on March 11, 2025, introducing major changes to the VAT system starting January 1, 2027. Key reforms include mandatory digital VAT reporting by 2030, new VAT collection rules for online platforms, and expanded One-Stop Shop (OSS) registration to simplify cross-border compliance. Additional measures, such as mandatory e-invoicing, phasing out... Read more
New document was uploaded: S4F backoffice patch
Author: Kristina Dosen
S4F backoffice patch is intended for users who have already installed S4F backoffice and are intended to update existing installations to latest version. To do so apply only patches that are marked with version number that is newer than your currently installed instance of backoffice. Read more
Croatian e-invoicing and e-reporting in January 2026, with public consultation novelties.
Croatia
Author: Nikola Novković
Croatia plans to introduce mandatory e-invoicing and e-reporting for domestic B2B transactions starting January 1, 2026, as part of its Fiscalization 2.0 initiative, with a public consultation launched on February 27, 2025. The system will include a taxpayer directory (AMS), a reporting platform ("FiskApplication"), and a free e-invoicing tool ("MICROeINVOICE"), aligning with local extensions of EN16931. Implementation will begin with fiscal cash registers for B2C transactions in September 2025, followed by mandatory e-invoicing for businesses in January 2026, and an extension to small enterprises and B2G transactions in January 2027. Read more
Croatia Sets Price Caps on 70 Essential Products Amidst Rising Inflation
Croatia
Author: Ivana Picajkić
The Croatian government is implementing price controls on 70 essential products starting February 7, 2025, to combat inflation and ensure affordability for consumers. Retailers must clearly display controlled prices, post informational posters, and designate specific sales areas for these items in larger stores. Read more
Slovenia: EU Targets Unsafe E-Commerce Imports with New Measures
Public
Author: Ivana Picajkić
The European Commission is tightening regulations on e-commerce imports to address the surge of unsafe and counterfeit goods, particularly from China, by reforming customs rules and increasing product safety checks. Key measures include removing the duty exemption for low-value parcels, introducing a potential customs fee, establishing priority control areas, and launching an EU-wide product safet... Read more
New document was uploaded: S4F backoffice patch
Author: Kristina Dosen
S4F backoffice patch is intended for users who have already installed S4F backoffice and are intended to update existing installations to latest version. To do so apply only patches that are marked with version number that is newer than your currently installed instance of backoffice. Read more
New document was uploaded: S4F backoffice installer
Author: Kristina Dosen
S4F backoffice installer is intended for users who are installing the software for the first time. Please make sure to obtain latest version of installer and to apply all subsequent patches that are released subsequently. This package contains instruction, release notes, changelog and software packages required for deployment of this software component. This version of the Backoffice installer supports the following countries: Austria, Bulgaria, Croatia, France, Italy, Poland, Portugal, Romania, Slovakia and Slovenia. Read more