Announced incentives in housing construction favor large investors and banks

The Construction Guild of the Croatian Chamber of Trades and Crafts (HOK) believes that the announced government incentives in housing construction could only benefit large companies and banks, and advocates that the funds from the incentives should be directed towards stimulating construction activities rather than maintaining existing real estate prices.

"The announced measures that the Government will implement through incentives should primarily focus on stimulating construction activities, rather than maintaining high profit margins for investors and bank earnings," states the Guild’s press release, which warns of the problems faced by construction tradespeople. The Guild emphasizes the need to allow real estate prices to be formed at a level where there is market demand. Funds from the incentives should be directed towards stimulating construction activities – for example, through incentivized housing construction, public-private partnerships, so that young people, as well as others, can more easily acquire their own property. By promoting the sale of already built properties, the invested capital of large investors and banks is protected, while tradespeople and their survival in construction are neglected, according to the Construction Guild of HOK, which gathers more than 12,000 construction tradespeople, including those engaged in finishing works.

The Guild also believes that abolishing the so-called solidarity tax could lead to an increase in citizens’ purchasing power. In the conclusions that will be sent to the relevant institutions, the most important problems faced by construction tradespeople are highlighted – reduced purchasing power, falling prices in construction, and decreased volume of work, compromised ethics and professionalism in business, increased black market work and unfair competition, non-transparent public tenders and political influences, unfavorable deadlines and payment methods, and high non-tax levies. The Guild emphasizes that it is necessary to carry out numerous activities together with the relevant institutions to facilitate the business operations of construction tradespeople. Among other things, the Guild demands timely and persistent inspection oversight of unregistered activities, ensuring mechanisms to protect tradespeople from the risks of working for investors who cannot guarantee investment security for the completion of construction, introducing discipline in payment deadlines with a maximum period of 30 days, and reducing the interest rate charged for exceeding payment deadlines for taxes owed to the state. (H)