Economist Slams Croatia's Anti-Inflation Plan for Ignoring Minimum Wage, Social Partners

Zagreb, Croatia – An economist has sharply criticized the Croatian government's latest anti-inflation package, arguing that it was decided unilaterally and fails to address critical economic disparities. The measures, presented by Finance Minister Tomislav Ćorić, aim to combat inflation, which he acknowledged is currently overshadowing otherwise strong economic results.

A primary point of contention is the exclusion of social partners, particularly trade unions. The government's decision to freeze wage adjustments throughout 2026, deviating from previous agreements, has drawn ire. "This is not how it's done," the economist stated, emphasizing that unions were seeking negotiations, not unilateral decisions.

Furthermore, the economist questioned the logic behind exempting pensions from taxes while continuing to levy taxes on the minimum wage. "When the government moved to make pensions tax-free, it should have also abolished taxes on the minimum wage. That would have been much more logical," the expert argued. While acknowledging the measure for pensioners as beneficial, the economist pointed out that it primarily aids those with higher pensions, leaving the most vulnerable workers, who earn the minimum wage and are on the brink of poverty, inadequately supported.

The package includes price freezes, a measure the economist deems effective and already in practice for years, and a tax on excessive profit margins, which is seen as an excellent move given rising business profits during high inflation. However, the economist contends that the government is misplacing blame for inflation solely on geopolitical situations. "The problem lies with the rulers because they are not controlling how that geopolitical situation is spilling over into the domestic economy," the expert asserted, suggesting that earlier measures were needed to protect citizens from unchecked price hikes.