We are indecisive, or perhaps we are not. This sentence probably best describes the multiple reconsiderations of the Government regarding the introduction of property tax, that phantasmagorical monster that, judging by public comments, will, in one day, like cyclone Boris, erase years of savings of Croats in bricks.
Although a timidly announced tax of one to ten euros per square meter, the Government has already retreated even before it was adopted – reducing it to zero to eight euros. To make that stick hurt less, information about a carrot in the form of a return of half of the VAT to buyers of new buildings has also been released. Personal deductions will also increase, and tax rates will decrease…
However, the presentation of tax changes has been postponed indefinitely, and it seems that in accordance with public sentiment, the long-announced housing strategy is being refined as it will, according to the latest information, only be completed by the end of this year.
Trial Balloons
– Since the tax is not set high, it is unlikely that more people will put their properties on the market and that this will bring about significant changes. Namely, if the price per square meter of an apartment is three thousand euros, eight euros per square meter is actually a tax rate of 0.26 percent. A greater burden in percentage terms could therefore be on cheaper properties, for example in the countryside, even if the tax is reduced to one euro per square meter. On the other hand, I fear that the measure of returning half of the VAT could be the new APN if it is not somehow limited. There is a possibility that such a thing exists in the legislative proposal, but it has not been made public – said financial analyst Marko Bogdan.
We do not know why new construction would be favored with a ‘forgiveness’ of half of the VAT, which is actually ten percent of the value, considering that for old construction a subsidy of only three percent is foreseen, i.e., a tax exemption on property transfer. Will such measures be available to those who buy properties worth half a million euros, which was previously possible under the APN, or will they be intended for those who really need it?
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