The General Tax Law

The General Tax Law

General Tax Law was applicable from 1 January 2003

On 1 January 2009, a new General Tax Act (GTA) came into force.

It was amended in 2012

The reason for the new act

The reason for introducing the new act was to provide more precise definitions of certain legal concepts in order to improve the application of taxation procedures and thus ensure better protection of taxpayers’ rights.

Moreover, thanks to the new act, the Croatian tax legislation complies with the European one, particularly as concerns the administrative cooperation and exchange of information among the EU Member States.

General Tax Law

The General Tax Law regulates the legal relations of taxpayers and tax authorities that are common to all taxes

Parties

Taxpayers and the state

Taxpayers are all natural and legal personsNot in equal positions – the state makes the

rules and taxpayers are in a subordinate position

Taxpayers have obligations with respect to the state, but they also have formal and material rights

The Tax Authorities

Main tasks:- to carry out the taxation procedure- to control its implementation

The principles upon which the law is based

LawfulnessThe application of tax provisionsObjectivityRight to appealThe keeping of books and recordsEvidenceAuditingGood faith of all participants of the tax procedureUse of standard language and writingEconomic approach

Lawfulness

Those who are involved in the relationship covered by the tax law are obliged to respect all legal rules

The application of tax provisions

In the taxation procedure, the tax rules that were in force at the time of the occurrence of the fact on which the taxation is based will be applied.

Objectivity

During the taxation process, the tax authorities establish the facts objectively and conscientiously, irrespective of whether they tend to be to the benefit or the detriment of the taxpayer.

Right to appeal

A taxpayer can file complaints against tax instruments.

Book-keeping

The taxpayer is obliged to keep records in accordance with the current book-keeping regulations.

Evidence

Both the taxpayer and the tax authority have to prove the facts in the tax procedure.

Auditing

Auditing is carried out with respect to both small and large taxpayers.

Good faith

All participants are obliged to behave properly, with good intentions, cooperatively and conscientiously.

Economic approach

Taxation facts are established according to their economic importance, which means that every acquisition of some income is taxed, irrespective of whether this is a legal or an illegal business.

Vocabulary practice

1. Find the appropriate subtitle for each paragraph:

The right to be informedProtection of human dignityThe right to responseProtection of confidentiality of data and

privacy

The Protection of Human Rights

The law also enshrines the protection of human rights such as: ___________________________________: taxpayers have the ability and the right to

speak their mind about all the essential facts related to the adoption of any decision (ruling or judgement) before that decision is made.

___________________________________: the taxpayer is bound to give the tax authority the truthful data that are essential in the taxation procedure, and the tax authority is bound to preserve the confidential data in the interest of the taxpayer. In this manner, the privacy of the taxpayer is protected. If the taxpayer renounces in writing the right to the protection of privacy, these data can be announced in public.

___________________________________: in the tax procedure, tax authorities may not threaten the reputation, dignity or honour of the taxpayer.

___________________________________: the tax authority may not use forcible payment methods (by seizure, for example) to take away the source of information for the taxpayer.

The law also enshrines the protection of human rights such as: The right to response: taxpayers have the ability and the right to speak their

mind about all the essential facts related to the adoption of any decision (ruling or judgement) before that decision is made.

Protection of confidentiality of data and privacy: the taxpayer is bound to give the tax authority the truthful data that are essential in the taxation procedure, and the tax authority is bound to preserve the confidential data in the interest of the taxpayer. In this manner, the privacy of the taxpayer is protected. If the taxpayer renounces in writing the right to the protection of privacy, these data can be announced in public.

Protection of human dignity: in the tax procedure, tax authorities may not threaten the reputation, dignity or honour of the taxpayer.

The right to be informed: the tax authority may not use forcible payment methods (by seizure, for example) to take away the source of information for the taxpayer.

Key terms

To keep books/recordsTo apply rules/lawsTo file a complaint (against)To prove the facts in the tax procedureTo the benefit of ----------- to the detriment of

the taxpayerTo be in force

Thank you for your attention!