Government: The Law on Fiscalization Eases Business Operations for Entrepreneurs

The government has submitted a proposal for the law on fiscalization to parliamentary procedure from its session on Thursday, which, according to the words of the State Secretary of the Ministry of Finance Tereza Rogić Lugarić, will create a legal framework for the exchange of electronic invoices between entrepreneurs, which should also lead to significant administrative relief.

– The law is expected to yield positive effects in several key areas, such as reducing the possibility of tax evasion, strong administrative relief, greater data accuracy, faster tax collection, and better fiscal policy planning – said Rogić Lugarić.

As stated in the proposal itself, the introduction of the obligation to issue eInvoices along with the fiscalization of eInvoices and the introduction of the eReporting system will lead to significant administrative relief and enable the abolition of a number of tax returns, including the abolition of reports on food donations (DON-H), the abolition of the Book of Outgoing Invoices (I-RA), the abolition of the Special Record of Received Invoices (U-RA), the abolition of the statistical form (RAD 1G) for small and medium-sized enterprises, etc., which is expected to result in savings for entrepreneurs estimated by the Ministry at over 120 million euros annually.

As Rogić Lugarić stated, fiscalization encompasses a set of normative and technical measures aimed at accurately recording and reporting transactions in the area of cash business. However, other transactions realized through the issuance of invoices, such as transactions between tax-paying entrepreneurs, as well as between public bodies, do not enter the existing reporting system and are not available through fiscal messages to the Tax Administration.

She stated that the legal tax system in Croatia already has the basic prerequisites necessary for transitioning to a new reporting system based on the issuance of e-invoices, but there is no comprehensive legal framework for the mandatory issuance and exchange of electronic invoices between entrepreneurs. Furthermore, she noted that the National Recovery and Resilience Plan (NPOO) has set a framework for administrative relief for entrepreneurs by enabling business optimization through the provision of interoperable, personalized, and digital public services.

Unique Legal Framework for the Exchange of Electronic Invoices Between Entrepreneurs

Therefore, in order to achieve the stated goal, it is necessary to create a unique legal framework for the exchange of electronic invoices between entrepreneurs.

– Accordingly, and for the comprehensive monitoring of taxpayers in all segments of business, it is proposed to adopt a unique regulation – the Law on Fiscalization, which will establish a comprehensive normative framework for the fiscalization of all invoices in final consumption, the issuance and fiscalization of e-invoices between tax-paying entrepreneurs, and the fiscalization of invoices issued in business between tax payers and public bodies – emphasized Rogić Lugarić.

Taxpayers will be required to keep e-invoices for the general statute of limitations, in accordance with the general tax law, after which the fiscal messages regarding issued and received e-invoices will be kept in the Tax Administration. In this way, the existing retention period for e-invoices as accounting documents will also be shortened for all e-invoices for which the fiscalization process has been carried out, added the State Secretary.

For small taxpayers, a free application “Micro e-Invoice” is provided, which offers services for the exchange of e-invoices, fiscalization of e-invoices, and storage of e-invoices for the period for which the taxpayer meets the conditions for its use, and they will be allowed to keep invoices for six years according to the general tax law.

Based on the proposal of the law, Rogić Lugarić stated, the fiscalization system would be gradually upgraded and would come into effect in three phases. Thus, on September 1, 2025, the provisions related to the fiscalization of invoices in final consumption should come into effect, on January 1, 2026, the provisions related to the issuance and fiscalization of e-invoices should come into effect, and from January 1, 2027, as issuers of e-invoices, taxpayers of income tax and profit tax who are not in the VAT system, as well as budgetary and extra-budgetary users, will be prescribed.

950,000 Euros for Mostar Airport

The government also made a decision at the session to allocate 950,000 euros for improving the air traffic connectivity of the City of Mostar with all regions of the Republic of Croatia as well as key transport hubs in the EU this year. The Ministry of the Sea, Transport and Infrastructure and the City of Mostar will conclude a contract regulating mutual rights and obligations.

The government reminds that in November last year, a contract was concluded in Mostar between the Ministry and the City of Mostar on participation in financing the program for improving the air traffic connectivity of the City of Mostar, based on which the implementation and financing of the program of Mostar Airport for providing regular international scheduled air transport service on the route Mostar – Zagreb – Mostar was ensured.

Based on the public call published by Mostar Airport, the carrier Croatia Airlines was selected, which performed this service with the aircraft DASH 8-Q400. During 2024, as part of this program, 147 aircraft operations were carried out (between 10 and 14 operations per month), transporting nearly 11,000 passengers with an average cabin occupancy of 49 percent.