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Amendments to Value Added Tax Act and Bylaw


Amendments of the Value Added Tax Act came into force on 19 December 2013 (with an exception relating to the increase of the reduced VAT rate from 10% to 13%, which came into force on 1 January 2014). The amendments to Value Added Tax Bylaw came into force on 1 January 2014.

In addition to the most important changes relating to the increase of the reduced VAT rate from 10% to 13% and taxation of daily newspapers that have media statutes with 5% rate, we note the following.

An exemption for supplies under the diplomatic and consular agreements and under applicable international agreements is realized through the request for VAT refund, if the goods supplied are not transported outside Croatia.

The definition of tax warehouses is also changed, while the list of goods that can be placed in tax warehouses is extended and approval for authorized holder of tax warehouse, conditions and procedure of approval as well as changes and withdrawal of approval and records is now prescribed in more details.

As regards telecommunication services, it is clarified that the place of taxation is where they are used only in cases when the services are provided to persons who are not taxpayers and are not established in the EU. Further changes relate to more detailed description of what is considered education services, who are the recipients of sport services and what is considered construction services.

Furthermore, amendments prescribe that domestic reverse charge is applied when the recipient of supply is registered in the VAT system and that enforcement body which sells goods in enforcement procedure is obliged to deliver a copy of sales document to the relevant Tax Authority.

Amendments affected also the provisions regulating conditions for deduction of input VAT which are not substantially changed but are now more detailed. In addition, provision regulating currency of the amounts stated on the invoices changed in a way that it is now possible to state amounts only in foreign currencies, except the total invoice amount and VAT which has to be paid that have to be stated in HRK.

Moreover, with respect to exemption for supplies of goods within EU which are transported by a person receiving the goods or other person on her/his behalf, requested evidences are amended in order for exemption to be applied.

In future editions we will address other changes and how these changes will affect the practice.


Portrait of Maja Marcelic
Maja Marcelic