NEWS

Digital money

Decision about crypto currency
READ MORE The EU Parliament has begun the process of creating a digital currency intended to replace US credit card systems, such as VISA and Mastercard. The goal is to create a virtual currency—similar to a "cryptocurrency"—for internal EU use. As reported by the EU Commission itself, there are significant details regarding payment security. Building powerful security systems is no easy feat. Current credit and debit card systems are already prone to cloning, and it is not the first time bank servers have been targeted by hackers. Other issues affecting its implementation include the electrical power grid, which the EU aims to make "green" as quickly as possible, but which currently remains unstable. For example, Spain suffered notable blackouts during the summer due to a system powered mostly by "alternative energy sources." Similarly, in Northern Europe, the harsh winters would leave the region without energy for months if not for thermoelectric power plants. According to some experts, the Digital Euro system is intended to eventually replace cash. But will it be possible? Replacing physical cash with a digital or electronic version would have an extreme impact on electronic payment systems, not to mention the legal and banking implications. Furthermore, it would fuel an energy-intensive system based on billions of daily transfers. This comes at a time when even AI developers in the US and China are planning massive investments in nuclear power plants to sustain their operations. There is also the question of whether this digital currency will be accepted by other countries. Finally, experts have highlighted other critical concerns, such as the potential for account freezes, digital credit issues, and more.

New Collective Bargaining Agreement

New agreement between SGH and HUP-UPG

READ MORE The signed amendments to the Collective Bargaining Agreement for the construction industry represent a significant step forward for the sector. The Trade Union of Construction Croatia and the Croatian Employers' Association - Construction Industry Association have successfully reached an agreement regarding these updates. It is important to clarify that these specific amendments currently bind only the parties that signed the agreement prior to February 1, 2026. For all other employers within the construction industry, these changes will become mandatory only once the Ministry extends the application of the agreement to cover all employers and employees across the Republic of Croatia, which is expected shortly. Consequently, starting from February 1, the signatories are obligated to adjust employee compensation, as the base gross salary for all job complexity groups within the tariff scale will increase by 10 percent, alongside an enhancement of other material rights for workers.

Tariff hours

Group complexity	Job complexity group	Based salary in euros per hour	Monthly
Group I: Refers to simple, routine work that does not require formal education or specialized training	Transport worker, cleaner, janitor, security guard, and delivery person	6,32	1.100,00
Group II: refers to less complex tasks and duties, specifically work for which written instructions are sufficient.	Semi-skilled construction workers, assistant semi-skilled workers of all trades, mechanical fitter assistant, machine and equipment operator in the production of construction elements, driller assistant, surveyor assistant (rodman), assistant cook, chambermaid, and switchboard operator	6,64	1.155,00
Group III: refers to medium-complexity tasks and duties characterized by repetitive work with the occasional emergence of new assignments.	Junior skilled construction worker (mason, carpenter, formwork system installer, steel fixer, concreter, roofer, scaffolding installer, welder, asphalter, dry wall installer, insulator, facade worker, ceramic tiler, joiner, stonemason, tinsmith, painter and decorator, locksmith, auto mechanic), junior skilled worker in other trades, driller, light construction machinery operator, tractor driver, metal structure installer, technical drafter, laboratory technician, administrator, assistant bookkeeper, warehouse clerk, cook, and waiter.	6,90	1.201,20
Group IV.a: refers to more complex and diverse tasks and duties that require consultations during their execution	skilled construction workers of all trades with completed vocational education (mason, carpenter, formwork system installer, steel fixer, concreter, roofer, scaffolding installer, welder, asphalter, dry wall installer, insulator, facade worker, ceramic tiler, joiner, stonemason, tinsmith, plumber, gas fitter, electrical installer, electrician, painter and decorator, locksmith, auto mechanic, etc.), freight motor vehicle driver, bus driver, universal mechanical fitter, gas and power plant installer, construction machinery operator, crane operator, concrete plant operator, construction laboratory technician, assistant estimator, site technician, cashier, head chef, and commercialist	7,56	1.315,60
Group IV.b: refers to more complex and diverse tasks and duties that require independence in their execution	skilled construction worker of all trades (mason, carpenter, formwork system installer, steel fixer, concreter, roofer, scaffolding installer, welder, asphalter, dry wall installer, insulator, facade worker, ceramic tiler, joiner, stonemason, tinsmith, plumber, gas fitter, electrical installer, electrician, painter and decorator, locksmith, auto mechanic, etc.), site technician, tower crane operator, specialist for the restoration of reinforced concrete structures, geo-drilling technician, land surveyor, wood processing technician, bookkeeper, computer operator, payment transactions officer, procurement officer, sales officer, estimating officer, HR officer, and other administrative officers	8,00	1.391,50
Group V.a: refers to more complex tasks and duties that require a higher degree of independence in their execution	highly skilled construction worker of all trades (mason, carpenter, formwork system installer, steel fixer, concreter, roofer, scaffolding installer, welder, asphalter, dry wall installer, insulator, facade worker, ceramic tiler, joiner, stonemason, tinsmith, plumber, gas fitter, electrical installer, electrician, painter and decorator, locksmith, auto mechanic, etc.), heavy construction machinery operator (excavator, grader, roller, loader, paver, tunnel trenching machine), heavy goods vehicle (HGV) driver, bus driver, foreman of simple structures, plants or workshops, estimator, and chief bookkeeper	8,36	1.454,75
Group V.b: refers to more complex tasks and duties that require a higher degree of independence in their execution	highly skilled construction worker of all trades (mason, carpenter, formwork system installer, steel fixer, concreter, roofer, scaffolding installer, welder, asphalter, dry wall installer, insulator, facade worker, ceramic tiler, joiner, stonemason, tinsmith, plumber, gas fitter, electrical installer, electrician, painter and decorator, locksmith, auto mechanic, etc.), specialist blaster, leading fitter, bus driver, construction machinery operator specialist, heavy goods vehicle (HGV) driver specialist, furnace builder, foreman / team leader, junior site supervisor, assembly supervisor, finishing works supervisor, maintenance supervisor, IT specialist, independent estimator, and independent officers	8,72	1.518,00
Group VI: refers to roles that require independence and a high degree of creativity in their execution	highly skilled construction worker – master of all trades, site supervisor, foreman, assistant site manager, manager of less complex works, site manager for smaller projects, works manager, head of estimating team, and occupational health and safety (OHS) specialist	9,10	1.584,00
Group VII: refers to roles that require specialized knowledge within a specific field of operation, alongside independence and creativity in the execution of tasks within those areas	construction manager, plant manager, machinery and transport manager, design engineer, department head in support services, land surveyor, legal counsel, and other specialistst	9,67	1683,00
Group VIII: refers to highly complex tasks and duties that require initiative and creativity from the employee, as well as the design of projects and assignments	construction manager, complex plant manager, software developer, mechanical design engineer, operational designer of metal structures, and head of department (estimating, accounting, commercial, finance, legal, production planning, etc.)	10,43	1.815,00
Group IX: refers to highly complex tasks and duties that require significant initiative and creativity, as well as additional specialized expertise necessary for their execution.	construction manager for highly complex sites, chief site engineer, and independent design engineer	10,94	1.903,00
Group X: refers to the most complex tasks and duties with the highest significance for managing production processes and business operations, encompassing creative tasks, research and development work, and strategic leadership	project director and executive manager of business operations – sector head	12,64	2.200,00
Group XI represents the highest echelon of organizational authority	Member of the Management Board and Director.	13,91	2.420,00

Interest rate drop

1.56 percentage points less
READ MORE The average bank interest rates in July 2025 fell for both deposits and loans. Short-term loan rates for businesses in July were lowered by an average of 2.89%, which is 1.56 percentage points less than a year ago. Long-term loan rates dropped to 3.48%, 1.84 points below the level from July 2024.

Wage in the last year

Average salary
READ MORE The average monthly net salary paid per employee in legal entities in the City of Zagreb for May of this year was 1,652 euros, which is a nominal increase of 0.6 percent compared to April and a rise of 8.8 percent compared to May of last year.

Trump and Ursula von der Leyen agreement

Trade agreement
READ MORE US President Donald Trump reached a trade agreement with the EU on Sunday, July 27, 2025, during a meeting with European Commission President Ursula von der Leyen in Scotland, according to media reports. The agreement includes a 15% tariff on EU goods entering the United States and EU purchases of US military equipment, Reuters reported. However, US goods will not be subject to tariffs in the EU, and gas and oil must be purchased from the United States instead of Russia. Duslci in fundo: The EU must invest around $600 billion in the USA, while EU industries are losing ground on the stock market.

ESRS Reports 2025

ESRS standard
READ MORE The first sustainability reports prepared according to ESRS standards will be published in 2025 for the financial year 2024. The first to report on sustainability according to the European sustainability reporting standards will be those currently subject to the Non-Financial Reporting Directive, namely public interest entities with over 500 employees. A year later, the obligation will come into force for all large companies. And from 2028, all small and medium-sized companies listed on the stock exchange will also report on sustainability. More info:
https://idop.hr/en/home-en/

Fiscalization 2.0

Law on Fiscalization
READ MORE At the government meeting of Republic of Croatia on April 24th, the Proposal of the Law on Fiscalization (Fiscalization 2.0) was adopted, which introduces modernized procedures for issuing e-invoices and the expansion of fiscalization to the B2B segment. The law enters into force on September 1st, 2025, and as already announced, it will be applied from January 1st, 2026. Until then, businesses are provided with a transitional period to adapt to the new operating system. The full application of e-invoices will begin on January 1st, 2027.

Inflacion according to CBS

Inflation rate: below 3%
READ MORE According to the latest inflation data from the Central Bureau of Statistics (CBS), the governor of the Croatian National Bank (CNB), Boris Vujčić, stated on Tuesday that the average inflation rate in Croatia this year could be below 3%, and that it will still be slightly higher than that of the Eurozone, where according to Eurostat data, inflation is around 2.2%.

S&P index

Clean energy index: down
READ MORE The S&P Global Clean Energy Transition Index a key indicator of the performance of leading clean energy companies, has fallen by 16 percent in the last 12 months. Many investors had expected a recovery at the end of last year, especially after interest rates had stabilized, or due to falling interest rates and rising electricity prices.

New accounting law

The new accounting law changes the following criteria for classifying entrepreneurs.
READ MORE MICRO-ENTREPRENEURS:
Total assets: €450.000
Net income: €900.000
Average number of employees: remains 10 units

SMALL-ENTREPRENEURS:
Total assets: €5.000.000
Net income: €10.000.000
Average number of employees: remains 50 units

MEDIUM-ENTREPRENEURS:
Total assets: €25.000.000
Net income: €50.000.000
Average number of employees: remains 250 units

LARGE-ENTREPRENEURS:
Entrepreneurs who meet at least two of the three requirements for medium-sized entrepreneurs.

ENTREPRENEURS REQUIRED FOR STATUTORY AUDIT:
Total assets: € 2.500.000
Net income: € 5.000.000
Average number of employees: at least 25 units

EU Statistics

Economic activity in the EU worsened in the fourth quarter...
READ MORE and employment was also on the verge of stagnation, according to data just released by the European Statistical Office. According to EURO Statistica, in the period from October to December the economy grew by 0.2%. Only the GDP of Portugal and Poland grew by 1.5 and 1.3 percent respectively compared to the previous three months. They are followed by Lithuania and Spain, where the increase was 0.9 and 0.8 percent respectively. In Austria and Italy it stood at the levels of the summer months. In the EU area there was an increase in the number of employees of only 0.1%.

Statement from the President of the ECB

The president of the European Central Bank (ECB)...
READ MORE Christine Lagarde, addressed the European Parliament with an optimistic message about the decline in inflation, but at the same time warned of the challenges arising from global trade tensions. She stressed the need for a prudent monetary policy and reiterated the importance of developing a digital euro for Europe's financial autonomy, Euronews reports. However, could the introduction of a digital euro really help the EU area? The euro currency in cash is the only solution for commission-free payments, while digital ones have them and the costs of electronic transactions would be too high. This means that over time inflation will return again. As for autonomy, one should not believe that this would be real.

Interest rate reduction

The European Central Bank (ECB) has decided...
READ MORE that there will be a further reduction of 0.25 percentage points in the three key interest rates, bringing them down to between 2.75 and 3.15 percent. Interest rates are the tool with which the central banks of the member states (EU) keep track of price trends. This decision comes after a period of almost two years in which it had first raised interest rates very rapidly and then kept them high to stop inflation at the EU level (price growth), triggered by the pandemic and the war in Ukraine. This new reduction will further lower interest rates on mortgages and business loans, as they have been doing for some time now.

Inflation rate in Croatia

According to Eurostat, the annual inflation rate in Croatia in December 2024 was...
READ MORE 4.5%. This is the highest officially recorded price increase among EU members, but if we look at it from another angle, 4.5% inflation is nothing special, especially for such a small and newly joined country like the EU. It is slightly higher than a desired price increase, which affects the GDP growth of a country. Who is to blame? First, retail chains have partly overdone the price increases, and secondly, politics is not going to interfere with the decisions and directives of the European Commission that continue to influence the increases in energy prices and taxes.

2025. Introduction of new tax reform

Property tax

READ MORE This tax will apply only to second homes or holiday homes. The tax rates will range between €0.60 and €8 per square metre. However, local authorities will have the discretion to determine the applicable rate. This tax will be payable by both legal entities and individuals for unoccupied properties, including banks, companies, and the state. Of course, this tax will not be payable by owners of properties used as their permanent residence or where a family member resides, nor by those with a long-term rental contract (at least 10 months per year) for residential use. Dilapidated and uninhabitable properties, as well as those used for agriculture and non-residential activities, will also be exempt. Furthermore, exemptions from this tax may be granted based on social criteria. "Hosts", or those managing small-scale tourist rentals as a secondary activity in a property where they have their primary residence, will also be exempt.

Personal income tax

There has been a change in the tax credit calculation for salaries, which has increased from €560 to €600. Additionally, the amounts for dependents and disabled individuals will increase proportionally. Therefore, the monthly tax credit for the 1st child will be €300, for the 2nd child €420, for the 3rd child €600, for the 4th child €840, and so on. For dependents and former spouses for whom maintenance payments are made, the tax credit this year amounts to €300, while the personal tax credit for disability varies from €180 to €600, depending on the degree of disability. The maximum amount has been lowered and the tax rates on income payable to municipalities have been increased, although municipalities will still decide on the specific tax rate. Below is the table:

New municipal income tax rates are defined for 2025.

Size of the municipality	NMinimum rate (%)	Maximum rate (%)
Municipality (small)	min 15% max 20%	min 25% max 30%
Town	min 15% max 21%	min 25% max 31%
Major cities and county seats	min 15% max 22%	min 25% max 32%
City of Zagreb	min 15% max 23%	min 25% max 33%

Additionally, starting this year, a 30% annual income tax rate will apply to income between €50,400 and €60,000. For companies and freelancers, the minimum threshold for entering the VAT contribution system will increase from €40,000 to €60,000 this year. Other changes in 2025 include increases in the non-taxable amounts for employee bonuses such as: productivity bonuses, up to a maximum of €1,200, severance pay, up to a maximum of €1,500, scholarships for students, up to a maximum of €600, and separate living allowance, up to a maximum of €300.

Hiring bonuses for young people

Young people aged 18 to 25 will continue to be eligible for a full reduction in annual income tax, while those aged 26 to 30 will receive a partial reduction (50%). However, the exemption from health insurance payments for young workers for five years will be abolished. Those already benefiting from this exemption may continue to use it until the end of the five-year period.
Minimum salary in 2025: €970.00/gross

Tax-exempt bonuses and other income not considered employment income:

Disability reimbursements for employees up to a maximum of €600 per year.
Reimbursements in case of the employee's death up to a maximum of €1,200.
One-off reimbursements in case of the death of a direct family member of the employee (spouse, parent, children, other direct ascendants and descendants, adopted children, foster children, and an adult for whom the taxpayer has been appointed guardian pursuant to a special law) up to a maximum of €600.
Support for continuous sick leave of employees for more than 90 days. A period of sick leave exceeding 90 days does not necessarily refer to a calendar year; up to a maximum of €600 per year.
Employee bonus for completing 10 years of service up to a maximum of €300.
Employee bonus for completing 15 years of service up to a maximum of €360.
Employee bonus for completing 20 years of service up to a maximum of €420.
Employee bonus for completing 25 years of service up to a maximum of €480.
Employee bonus for completing 30 years of service up to a maximum of €540.
Employee bonus for completing 35 years of service up to a maximum of €600.
Employee bonus for completing 40 years of service and for every subsequent 5 years of service up to a maximum of €720.
Travel allowances up to a maximum of €300 per month.
Severance pay up to €1,500.
Severance pay for company and personal redundancies, in accordance with the law governing employment, up to a maximum of €960 for each year of service with that employer.
Severance pay for work-related accidents or occupational diseases up to a maximum of €1,200 for each year of service with that employer.
Support for the child of a deceased or former employee who has completely lost their ability to work for educational purposes until the age of fifteen, or until the completion of primary education will be a maximum of €600 per month.
Baby bonus up to a maximum of €1,500.
Productivity bonuses and other forms of additional bonuses for employees (in addition to salary, salary supplement, etc.) up to a maximum of €1,200 per year.

Tax-exempt income from scholarships, awards, and other compensation with other income. Income whose value is not considered taxable by law:

Bonuses for students during internships and apprenticeships, as well as allowances during "dual" training (Article 9, paragraph 1, point 4 of the law) up to a maximum of €300.00 per month.
Income for the training of pupils and students for work through student associations (Article 9, paragraph 1, point 6 of the law) up to a maximum of €3,600.00 per year.
Scholarships for full-time students, including those studying abroad at secondary, upper secondary, and university level (Article 9, paragraph 1, point 14 of the law) up to a maximum of €600.00 per month.
Scholarships for students of national and foreign universities, awarded to students with excellent academic results and who have been selected for scholarships through public competitions accessible to all students on an equal basis (Article 9, paragraph 1, point 14 of the law) up to a maximum of €900.00 per month.
Sports scholarships paid to athletes for their sports training according to special regulations (Article 9, paragraph 1, point 16 of the law) up to a maximum of €600.00 per month
Prizes for sporting merit (Article 9, paragraph 1, point 17 of the law) up to a maximum of €3,000.00 per year.
Remuneration paid to amateur athletes according to special regulations (Article 9, paragraph 1, point 17 of the law) up to a maximum of €600.00 per month.

Here are the laws that have changed since 1.1.2025 (source: Porezna uprava):
www.porezna-uprava.hr/Stranice/Vijest.aspx?NewsID=3813&List=Vijesti
www.porezna-uprava.hr/Stranice/Porezna_Reforma
www.porezna-uprava.hr/Stranice/Vijest.aspx?NewsID=3831&List=Vijesti

HZZ (Employment Office) New employment measures

The Croatian Employment Service offers substantial financial support to employers who hire individuals with disabilities or those lacking formal education.
READ MORE This support can cover up to 100% of the new employee's salary. For businesses looking to take on young interns, the service provides co-funding of up to 60% towards the intern's salary and associated transportation costs, aiding in their transition to the workforce.Additionally, the service offers financial incentives for employers investing in the further training of their employees. Aligned with the Croatian Qualifications Framework, businesses can receive up to 70% co-funding on eligible training costs.

For more details, please visit the following link:
mjere.hzz.hr/?utm_source=newsletter&utm_medium=weblink&utm_campaign=era-mjera-2025

NEW MEASURES AGAINST RISING ENERGY PRICES

The law is amended, definitively reducing the VAT on heating gas from 25% to 13%...
READ MORE

VAT on food is also reduced from 13% to 5% on fresh meat and fish, eggs, fruit, vegetables, edible oils and fats, baby food, agricultural costs, seedlings, fertilizers and pesticides, while VAT it is further lowered from 25% to 5%. on butter and margarine. The VAT on sanitary pads and tampons is also reduced from 25% to 13%. The VAT on tickets for sporting, cultural and other events is also reduced by 25 and 13 to 5 percent.