Potential Rise in Energy Prices Could Affect Entrepreneurship

The potential impact of a rise in energy prices on entrepreneurship, especially small and micro enterprises, should be carefully assessed, warns Irena Weber, the Director General of the Croatian Employers’ Association (HUP), on Tuesday.

Medium and large entrepreneurs have been paying market prices for energy for a year now, and for small and micro entrepreneurs, the impact of potential subsidy removal should be carefully evaluated, as this would have a strong negative effect in the event of price increases, Weber stated on the sidelines of the conference “Projects and Public Procurement in Asian Infrastructure Investment Bank Projects.”

– If costs rise significantly overnight, it can have a strong impact on business. If there are increases in energy prices, we expect them not to be dramatic, but it is important to know that there is a safeguard that will protect small and micro entrepreneurs – said Weber.

She notes that in most EU countries, the economy pays a lower price for energy than households, which is logical as the laws of economics dictate: larger consumers pay a lower price due to economies of scale.

This is not the case here, and it affects competitiveness, especially for exporters, says the head of HUP.

Support for Tax Relief on Labor

Regarding the announced tax relief on labor, she said that HUP has been advocating for this for years.

– We are a country of labor and education, and therefore we believe that tax policy should encourage stronger labor relief, especially in the area of medium and higher wages, as these are citizens working in sectors of higher added value, such as engineers, doctors, IT professionals, and professors – she said.

Generally Against New Taxes, But…

When it comes to property tax, she says that employers are generally against any additional taxation, but on the other hand, they have warned of a series of negative effects of uncontrolled rent-seeking on the economy, such as the explosion of real estate prices, disruptions in the labor market, and complete disinterest in education, as well as the overburdening of communal infrastructure.

– These are all the issues we have warned about, and it certainly makes sense to consider the structure of our economy and turn away from the policy of uncontrolled rent-seeking – said Weber.