ECONOMICS

Croatia Regulatory Enviroment

Business Climate and Taxation in Croatia

Croatia’s business environment has improved, with the time to start a company reduced to seven days and corporate tax rates of 18% or 10%, depending on revenue. While VAT stands at 25%, reforms in 2024 aim to boost net wages and refine personal income tax structures. Although rankings in the World Bank’s new “Business Ready” report are unavailable, Croatia continues to advance in regulatory efficiency and economic reforms.

Although the World Bank’s “Ease of Doing Business” report was discontinued in 2021, Croatia ranked 51st out of 190 economies in the 2020 report. In October 2024, the World Bank introduced the “Business Ready” report, evaluating the business climates of 50 economies. While specific rankings for Croatia in this new report are not publicly available, the initiative aims to provide a comprehensive assessment of regulatory quality and public service effectiveness. According to UHY’s “Doing Business in Croatia” report, the period needed to start a company has been reduced from an average of 29 days to approximately seven days. 

The cost of starting a business in Croatia was reported at 6.2% of income per capita in 2019, reflecting a decline from 6.6% in previous years. Croatia imposes a corporate income tax rate of 18% for companies with annual revenues exceeding EUR 1 million. For companies with revenues below this threshold, a reduced rate of 10% applies. The standard VAT rate is 25%, with reduced rates of 13% and 5% applicable to certain goods and services. In 2024, Croatia implemented tax reforms aimed at increasing net wages for workers. These reforms include adjustments to personal income tax rates and other measures designed to enhance the overall tax structure. 

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2025-02-13T20:20:26+01:00

Croatia Regulatory Enviroment

Croatia’s business environment has improved, with the time to start a company reduced to seven days and corporate tax rates of 18% or 10%, depending on revenue. While VAT stands at 25%, reforms in 2024 aim to boost net wages and refine personal income tax structures. Although rankings in the World Bank's new "Business Ready" report are unavailable, Croatia continues to advance in regulatory efficiency and economic reforms.

2025-02-13T20:20:13+01:00

Croatia Economic Indicators

Croatia’s nominal GDP is projected to reach $88.08 billion in 2024, with steady growth supported by private consumption and investments. The unemployment rate has declined to 5.6%, while inflation is expected to stabilize at 2.5%. The ICT sector, a vital economic driver, continues to expand, with tech exports rising to 2.14% of GDP in 2022. Investments in education and sustainability are fostering a skilled workforce, essential for long-term growth. Croatia’s integration into the EU, Schengen zone, and euro area further bolsters trade and investment prospects.