Under public pressure, Croatian government amends student tax regulation

The Income Tax Regulation, which came into effect in Croatia on January 2nd, will be amended by the Government just three days later, Index.hr reported! Namely, after students bombarded both editorial offices and institutions with numerous emails on Thursday night into Friday, the media discovered that the Income Tax Regulation published in Narodne novine stated that authorities would tax all amounts exceeding 15,000 kuna, or about 4,000 KM, earned by students in a year. Therefore, Andrej Plenković's Government proposed that students in Croatia could earn a maximum of about 4,000 KM per year without being taxed. If they earned more than that, the state would charge them tax. Following public pressure, the Tax Administration announced a change to the Regulation!

The wave of student protest that erupted due to the reduction of the tax-free income threshold for students from 50,000 to 15,000 kuna also caused instability on the political scene. Andrej Plenković initially claimed he would sit down and see what could be done, but even members of the HDZ youth wing stood up against his tax reform, at least the part concerning students.

The HDZ youth wings in Split and Zagreb announced their support for students on their Facebook pages. After Index published an article about it, the Zagreb HDZ youth wing removed their statement from social media. MOST, through its parliamentary representative Ivana Ninčević Lesandrić, also stood up in defense of the students, also on Facebook, and her post was even shared on the official page of MOST, the main coalition partner of HDZ in the government.

The fact that the situation was serious was proven by over 16,000 petition signatures collected in less than five hours. The student protest could easily have moved to the streets and gathered much wider masses than just students. In an attempt to extinguish the fire, the Ministry of Finance and the Tax Administration hastily invited representatives of the Student Union of the University of Zagreb to a meeting. For those unfamiliar, this is a representative body of students led by a young HDZ member, and most of its members are active members and volunteers of the ruling party.

Following the expressively scheduled meeting, which was held on a day that is usually a shortened workday, the union members sent a reassuring message to their fellow students – everything was misunderstood, and the tax administration would soon explain what was going on.

In a statement, the Tax Administration stated that students would no longer have an annual exemption of 50,000 kuna, as had been the practice in previous years, but a monthly exemption of 5,050 kuna. This amounts to approximately 60,600 kuna annually, which is significantly more than the previous amount.

However, amidst a pile of bureaucratic statements, the Tax Administration actually revealed the most significant point – "Detailed elaboration of the provisions of the aforementioned Law will be prescribed by a new Income Tax Regulation, which is in preparation and will be adopted within 90 days." The Income Tax Regulation, which is currently in force, was adopted just three days ago. Specifically, on January 2, 2017, the Ministry of Finance adopted that regulation. Today, just three days later, they announce – "we are changing the regulation, but that was our intention anyway."

- Although the Tax Administration (which is part of the Ministry of Finance) is trying to get out of this with platitudes that their goal is to "accommodate the youth," it is clear that in this situation, the students have won – writes Index.

Just a few hours after the "Take from students, give to cronies" affair broke out, a group of students (those close to HDZ) were received at the Ministry of Finance, and then the Tax Administration quietly announced – we will change the recently adopted regulation, reports Patria.

Although a delegation of HDZ students went to the ministry, this is actually a victory for every student individually. Every student who sent emails to institutions and media, who wrote on social networks, and whom politicians took quite seriously. And now it is also clear who even Andrej Plenković fears in this country.