Croatia updates VAT rates for 2013

In addition to next year's Croatian VAT rise from 2% to 25%, there are to be more increases in rates on certain goods.

From 1 January 2013, basic foods, cinema tickets and other products will be reclassified from the zero VAT rate to the reduced 5% VAT rate.

Sports and recreational vehicles or vessels will also now be taxed at the 5% VAT rate.

The changes are partially to increase state revenues, but also to bring the Croatian VAT system into line with the European VAT regime as Croatia prepares its accession application.