The Ministry of Finance and the Delegation of the European Union to the Republic of Croatia held theOpening ceremony of the Twinning Project “Enhancement of the Administrative Capacity of Croatian Tax Administration in the Field of Audit” financed under EU IPA 2009 Programme for Croatia.
The objectives of this project are to strengthen the Croatian Tax Administration (CTA) functions of tax auditing and battling tax fraud in line with EU best practices. The project, with a budget of € 1 million, is financed by the European Commission and will last 21 months.
The expected results of the project are focused on a strategic approach on auditing of tax and combating tax fraud in the Republic of Croatia with regard to EU best practices. Therefore, methodological tools as well as an e-audit function of the CTA will be developed while the administrative capacity of the CTA staff will be enhanced.
The project covers the following main components:
- Strengthening the CTA audit system as a whole
Improving the CTA audit system through the elaboration of an audit strategy and action plan as well as manuals and methods for the audit of taxpayers including the training of CTA staff;
- Establishing the e-audit function
Developing and implementing an electronic audit system;
- Enhancement of the administrative capacity in the field of audit of Value Added Tax (VAT) and combating tax fraud
Enhancing capacities in auditing VAT and combating tax fraud through the development of a manual and the training of CTA staff.
The project is of great importance for Croatia in the framework of the EU accession process. As stated during the EU accession negotiations, Croatia has to enforce its efforts in aligning tax legislation in the field of VAT, combating tax fraud and strengthening of administrative capacity despite notable progress in the past years.
Through this Twinning project, the EU assists the Croatian Tax Administration in establishing an effective and equitable tax system while fulfilling its legal obligations upon entering the EU.