Croatia may set 2027 minimum wage at €1,250; employers want smaller increase
Government must decide by end of October as employers push for a limited 3.5% increase and tax-relief measures.
Croatia faces a government decision by the end of October on the 2027 statutory minimum wage that, according to early announcements, could reach €1,250 gross. Employers warn that an increase of that size would put substantial pressure on firms and are pushing for a much smaller rise.
The Croatian Employers' Association (HUP) has proposed limiting the gross minimum wage increase to 3.5 percent — from the current €1,050 to €1,086.75. HUP argues that such an adjustment would be consistent with economic conditions and European recommendations on minimum incomes.
Representatives of the business community say labour costs in Croatia are rising faster than productivity, eroding private-sector competitiveness. They want future minimum-wage moves set by a clear formula that takes inflation and productivity into account to avoid ad hoc hikes.
Tax relief and budget constraints
In addition to the wage proposal, HUP calls for a rise in the basic personal tax allowance, which currently stands at €600. Employers say that increasing this allowance would raise net take-home pay for workers while limiting additional costs for companies.
The debate over the minimum comes as the Croatian government contends with limited fiscal space. Following the latest budget rebalance, planned state spending increased by €745 million to a total of €40.6 billion, and the budget deficit is now projected at 2.9 percent of GDP.
The final level of the minimum wage for 2027 must be set no later than the end of October.
Photo: press material from the event
