Taxation system


			TAXATION SYSTEM Croatia is conducting a taxation reform on the basis of the systems used in Western European countries with developed market economies. The taxation system gives equal status to all taxpayers, i.e., domestic and foreign natural persons and legal entities. Croatia honours all double taxation agreements made between the former Yugoslavia and other countries, and has already signed new international agreements on avoiding double taxation with numerous other countries. REAL ESTATE SALES TAX Real Estate Sales Tax is paid on every sale, exchange or other acquisition of real estate using money (the term real estate refers to farming land, construction land, residential and business premises and other buildings). Sales tax is paid by the vendor of the real estate at the rate of 5% of the sale value of the real estate. The acquisition of newly built buildings, which are taxed according to the VAT Act, is not regarded as a real estate sale. March 2000