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Photograph: Hina/ Tomislav Pavlek/ tp

Officials of the Croatian Democratic Union (HDZ) and the Social Democratic Party (SDP)-led People's Coalition said on Thursday that they would continue fiscal consolidation and reduce the tax burden if they came to power after the September 11 election, and they also promised assistance to the jobless and those in financial trouble.

They presented their platforms at a round table in Zagreb, organised by the Croatian Employers' Association (HUP) and the Hanza media company. The event began with the question what those camps plan to do in the first 100 days of their new governments.

Sinisa Hajdas Doncic of the SDP promised that the no-taxable income would be raised from 2,600 to 3,000 kuna and also raising of the tax brackets for a 25-percent tax rate, which, he believes, may result in higher salaries for Croatians.

According to Hajdas-Doncic, the SDP intends to reduce the value added tax from 25% to 13% for specific agricultural produce produced in Croatia such as oily dark-fleshed fish, apple, mandarins as well as on some tourist services. 

On the other hand, Ivana Maletic of the HDZ announced a comprehensive reform which will include the non-taxable part of the salary standing at HRK 3,750 and the reduction of the highest tax rate on income from 40% to 36% as well as the introduction of a 12-percent rate on profit posted by small businesses.

She also announced the introduction of in-work benefits.

The SDP-led coalition plans the decentralisation, including the downsizing the number of counties from the current 20 to 12 or 15, while the HDZ is against this downsizing.

The two camps agree on the introduction of a real estate tax as a project in the long run, admitting that the preparations for this move are complex.

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