On Wednesday, the government submitted to parliamentary procedure amendments to the law on value added tax, which, in addition to the necessary elements of adaptation to the introduction of the euro, foresees a reduction of the VAT rate to 5 percent on the delivery of wood chips, pellets and firewood, as well as a zero VAT rate for solar panels.
According to Finance Minister, Marko Primorc, the amendment to the law proposes a change in the provisions related to the introduction of the euro, as well as further tax relief and mitigation of price increases faced by citizens and the economy.
Thus, it is proposed that the delivery of heating from thermal stations, including fees related to that delivery and the delivery of firewood, pellets, briquettes and wood chips, performed from the day the law enters into force until 31 March 2023.
Furthermore, it is proposed that VAT be taxed at a rate of zero percent on the delivery and installation of solar panels on private residential buildings, residential premises, and public and other buildings. This rate, the minister stated, would be applied to the delivery and installation of solar panels only for final consumption, i.e. to deliveries to citizens and their energy communities, or to multi-apartment buildings and persons performing activities of public interest.
This opens up space for lowering prices as an incentive for the use of renewable energy sources, said Primorac.
In the explanation of the proposed law, it is stated that the proposed measures will reduce the revenues of the state budget based on VAT in the amount of about HRK 120 million annually.