Photo taken from the platform Freepik.

Croatia is facing a significant fiscal reform which, according to the new Fiscalization Act, will begin to gradually replace paper receipts with electronic invoices from January 1, 2026, with full implementation of eInvoices planned from January 1, 2027. This change, supported by members of parliament, will bring progress in combating tax fraud and evasion, as well as reducing unfair competition on the Croatian market, writes N1 Info.

Member of parliament Boris Lalovac emphasized that tax fraud at the level of the European Union reaches 100 billion euros annually, which represents a challenge not only for the state, but also for entrepreneurs in Croatia, because it undermines fair market competition and makes business more difficult for those who regularly meet their tax obligations.

The digitalization of business through eInvoice is particularly important for Croatia, considering that currently about one third of 170,000 entrepreneurs in the VAT system use eInvoice. The introduction of a general obligation to issue and receive eInvoices, along with the transfer of data to the Tax Administration in real time, will enable more efficient control of reported and collected VAT, as also highlighted by member of parliament Petar Šimić.

With the proposed law, Croatia will get the most advanced fiscalization system in Europe, and the new model, known as "fiscalization 2.0", represents the largest digitalization-transformation project in the history of Croatia. The digital transformation of the Tax Administration and the introduction of the Population Register will further improve the transparency and efficiency of the fiscal system.

According to the State Secretary at the Ministry of Finance, Tereza Rogić Lugarić, the new law brings a unified tax and legal framework for the fiscalization of all invoices in final consumption, as well as for the issuance and fiscalization of eInvoices between taxpayers and public bodies. The fiscalization system in Croatia will be upgraded gradually, and certain provisions of the law will enter into force successively. The first step will be the fiscalization of invoices in final consumption from September 1 of this year, while from January 1, 2027, the obligation to issue eInvoices will also be extended to income tax and profit tax payers who are not in the VAT system, as well as to budgetary and extra-budgetary users.

The Ministry of Finance of the Republic of Croatia estimates that this reform will bring more than 120 million euros in annual savings for Croatian entrepreneurs.