Next to tax holidays and subsidies related to the expenses of opening new working places as well as worker training expenses, a new measure has been introduced for projects over 13 million EUR in value
On September 25th, 2015 a new Investment Promotion Act has been adopted by the Croatian Parliament and has come into force at the beginning of October 2015 with the aim of harmonization with EU legislation for the new programming period 2014 – 2020. The authorities responsible for the enforcement of this Act were the Ministry of entrepreneurship and crafts and the Ministry of Economy.
The full text of the Act can be found in the Croatian National Gazette NN 102/15.
The Investment Promotion Act is governing state aid and incentives on behalf of the Croatian state with the aim of encouraging new foreign and domestic investments all with the aim of successful and time defined realization of investment projects in Croatia aimed at the improvement and growth of Croatian economy.
The beneficiary of the state aid can be either an individual person subject to corporate income tax, or a legal entity: micro, small, medium or large entrepreneur, registered in Croatia.
The following types of state aid forms are anticipated by the Act: tax related aid, aid for the eligible expenses of creating new jobs and the eligible expenses for training and education, aid for development and innovation activities, activities of business support and activities and high value added services, aid for projects’ capital expenditure, aid for labour - intensive investment projects, and a new measure for investments of minimum 13 million EUR and 10 new university degree job positions.
The terms and conditions as well as the aid intensity of the individual state aid prescribed by the Act vary according the size of the applicant and the size and the nature of the investment itself. In order to apply for incentives under this Act, it is necessary to (1) submit an application for the approval of the Status of state aid beneficiary while responsible authorities will issue a Status certificate no later than 60 days from the application date (2). The financing structure of eligible projects under the provisions of this Act ought to be free from any type of (state) aid in the minimum of 25% of the eligible investment expenses.
With the new Croatian Government in power, the relevant Implementing Directive and the belonging Application forms have been adopted and published in the National Gazette 11/16.
You can download a brief memo leaflet here.