The Glas poduzetnika association calls for the withdrawal of the proposal for higher taxes on lump-sum taxpayers with incomes over 40,000 euros in the public consultation, pointing to a lack of analysis and risks to the economy.
The Glas poduzetnika association (UGP) on Saturday, August 1, 2026, voiced strong opposition to the government's proposed amendments to the Income Tax Act. According to Glas Istre, UGP will demand the removal of provisions that increase the tax burden for lump-sum craftsmen with annual incomes exceeding 40,000 euros during the e-consultation.
The Croatian government justifies the move as a fight against concealed non-independent work. The proposed amendments foresee a reduction in recognized expenses from 85 to 70 percent for incomes between 40,000 and 50,000 euros, and to 55 percent for those between 50,000 and 60,000 euros.
The association does not dispute the state's right to adjust the tax framework, but points out that the proposal lacks an adequate analytical basis. "The proposal's explanation states that there is a problem of concealed work, but no data is presented to show the actual extent of abuses, nor an assessment of the effects of the proposed changes on small businesses, service prices, and competitiveness," reads the UGP statement cited by Dulist.
They also remind of the specific position of craftsmen, who independently find clients, bear the risk of unpaid receivables, finance equipment and business development, and have no right to paid sick leave, annual vacation, or a secure salary. "If someone cheats, the state should find and punish them. There's no need to punish everyone else," UGP said for Dulist.
UGP warns that the proposed model sends the wrong message to those who are growing their businesses. "Entrepreneurs have been encouraged for years to grow, increase turnover, and develop their businesses. This proposal sends a message that growth itself becomes a reason for new tax burdens," Dulist reports from the statement.
They see a particular absurdity in the fact that the measure is advertised as part of the anti-inflation package. "Increasing the tax burden raises business costs, and part of those costs typically gets passed on to service prices. That's why it's fair to ask how this measure will actually contribute to reducing inflation," Dulist quotes the association's stance.
Despite the criticism, UGP recognized positive elements in the government's package. "We welcome the tax relief on pensions and the introduction of the Croatian investment account, which should make it easier for citizens to invest and reduce bureaucracy," the statement says, as reported by Dnevno.hr.
However, this does not change their fundamental demand. UGP will seek precise criteria for detecting concealed work and targeted inspections of those who actually exploit loopholes in the system during the e-consultation. "The state should go after those who cheat, not those who work, invest, and develop their businesses," concludes the statement carried by Dulist.
