Croatian gov't extends economic stimulus package
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E-mail Xinhua, April 2, 2020
ZAGREB, April 1 (Xinhua) -- Croatian Prime Minister Andrej Plenkovic introduced on Wednesday a new package to combat the economic impact of the coronavirus that includes writing off income and payroll taxes for three months.
In a televised press conference, Plenkovic said that the objective is to save jobs and help businesses hit by the biggest crisis since the Croatian War of Independence. That is why, he said, the government has decided to extend the first economic package introduced two weeks ago and increase the net minimum wage to 4,000 kuna (573 U.S. dollars).
Another important measure is a complete tax exemption for the next three months for businesses whose income is below 7.5 million kuna and whose revenue has dropped by more than 50 percent. More than 90 percent of Croatian business is in that category. For larger businesses, the tax exemption will be in proportion to the decline of their revenue.
The third measure is a temporary change to the value added tax (VAT) payments, which will be collected only after a customer pays the bill and not when the company issues the bill, as is the practice today.
The new economic package is worth more than 30 billion kuna. Two weeks ago, the government introduced the first package of almost the same size. The prime minister said that more than 65,000 companies and 400,000 people are already using the government's measures to save jobs.
Finance Minister Zdravko Maric said on Wednesday that Croatia will need at least 45 billion kuna in the next three months. He explained that the first source of financing is the domestic market with the agreement with the Croatian National Bank, but the government will also look for funds and loans on the international market.
On Wednesday, the Tax Administration of the Finance Ministry announced that between March 23 and March 29 the number of invoices issued in Croatia decreased by 65 percent compared to the same period last year.
The Croatian parliament is scheduled to adopt the new measures on Friday or early next week. Enditem
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