LIPA aims to educate post-Communist Croatia and its policymakers on the long-term economic benefits of cutting taxes and to advocate better stewardship of public funds, reducing the size of the public sector and market reforms. We will do this without Croatian government funding as a matter of principle. The Association advocates active participation of citizens in government and greater involvement of taxpayers in making political decisions.
Lipa actively participates in political and public space as a nongovernmental organization and is committed to undertaking real reforms that will lead to:
- Lower taxes
Croatia has one of the highest tax burden in the world. Taxpayers have the right to demand a reduction of the general taxation level and consequently to have the biggest part of their work on their disposal.
Croatian administration is a too large and too expensive bureaucratic apparatus. Lipa is committed to reducing bureaucracy and limiting public spending. Our plan is to use public pressure to influence the Government to cut spending and introduce a balanced budget and greater fiscal responsibility.
Taxpayers have the right to know how their money is being spent, and the responsibility to monitor that expenditure. Lipa will focus all its activities on putting pressure at all levels of government to enable citizens a better insight into how their money is spent.
The taxpayer’s money must be spent purposefully i.e. it should be directed to the public services important for all citizens instead of on particular goals such as buying votes, satisfying certain groups, and buying social peace with the wrong measures.
Reduction of public debt
Irresponsible governments in the coalition with interest groups led Croatia to the very edge of excessive indebtedness. Paying that debt in the coming years will further burden Croatian taxpayers. The objective of “Lipa” is to alert citizens about the amount of public debt and the interest we are paying.
Where does our name come from?
Kuna is the official Croatian currency, and one kuna (HRK) consists of 100 lipa.
Lipa is also an old-Slavic tree (lat. Tilia).
Under a Lipa tree, in Gornja Stubica, not far away from Zagreb, was a meeting point for serfs that rebelled against high taxes in 1573. The rebellion was broken, and the leader – Matija Gubec was brutally executed. The Lipa tree they met under is still there until this day.
What we have done
The Tax Free Day Calculator
In early May 2015, LIPA launched the Tax-Free Day Calculator as a departure from “reform as an academic debate” towards grassroots activism.
Twenty thousand people used the Tax-Free Day Calculator on the first day; amounting to over 4% of the Croatian population! In American terms: Croatian citizens in numbers more than double the population of the DC Metro area (DC plus VA and MD) accessed the Tax-Free Day Calculator on its launch day. The response was overwhelming. Our FB presence ballooned overnight!
Taxpayers’ association Lipa organized a roundtable discussion of the initiative for smart regulation CROFIT; a system of measuring and tracking regulations and procedures with the goal of diminishing costs for companies and citizens, including an interactive website for complaints, e-registry of all regulations and administrative procedures, and digitalization of all public services.
It could, by the end of 2017, bring an estimated saving of HRK 3-6 billion ($441 million $883 million), and an ROI of approximately 130.
Lipa also stepped up its lobbying campaign, with two letters to the Minister of Finances, urging him to help Croatia towards a more responsible path in regards to public finances and budgeting. The letters emphasized the need for certain reforms; making the budget, and the methodology of budget oversight, 6 7 more transparent; fiscal consolidation, easing of tax and regulatory burdens.
Lipa also organized a roundtable discussion of a budget proposal for 2016, made by two students of the Economic College, University of Zagreb, which proposed a bold, yet moderate, plan for fiscal consolidation over the next few years. The three goals that guide the plan were: not to decrease slowly growing economic activity, social order, and the level of quality in public services.
The proposal limited itself to fiscal measures; however, they encouraged politicians to push for structural reforms. In this way, Lipa tried to sway the new government and the public opinion in the direction of fiscal consolidation: the eventual budget, made by the government, was less ambitious, but still in the right direction. In large part, this was due to the presence, in the public sphere, of the recognition of the crushing effects of public debt, and the need to consolidate Croatian finances.
In 2015, Lipa was invited to take part in the Economic Council of the President of the Republic of Croatia, Mrs Kolinda Grabar-Kitarović. President of Lipa Davor Huić served as the member of the council, until his resignation on March 9, 2106, when he became the advisor of the Prime Minister of the Republic of Croatia, Mr Tihomir Orešković.
The Public Debt Counter
In September of 2015, Lipa constructed and presented its Public Debt Counter, a web-site and a public display of its rising public debt in real time.
Croatia’s public debt was approaching 90 percent at the time, but there was little public debate about the problem and little public awareness that it was a problem. Lipa launched the project in order to force the issue into the public domain ahead of the parliamentary elections that took place in November of that year.
Following the elections, a coalition government was formed with Mr Orešković as prime minister. Mr Orešković’s government’s explicit goal was to reduce public spending, bring the budget deficit under control, and start reducing the public debt, precisely the issues Lipa wanted to become the central political issue the government needs to address.
Orešković’s government also proposed a comprehensive program of pro-market reforms, but has lost support in the parliament and was forced to resign.
Campaign against the introduction of the property tax
Lipa’s most ambitious and most successful public action came in 2017 when it launched a campaign to stop the introduction of the property tax.
The campaign was launched in April with a call to citizens to sign an online petition opposing the tax. Some 20.000 people signed in the first 24 hours and the number kept rising to more than 145.000 when the Prime Minister Andrej Plenković pledged to abandon the implementation of the tax, which happened a month later.
The campaign raised the public profile of Lipa significantly, earning it tons of media coverage, and regular invitations from media to provide comment on current political issues regarding taxes, public spending and reforms.
For this successful campaign, Croatian Public Relations Association (HUOJ) awarded Lipa with a Grand Prix in the category of non-governmental organizations. Flying on the success of the property tax campaign, in late 2017 Lipa has launched a crowdfunding campaign for the implementation of a new project entitled “The Black Book of Public Money Expenditure”, managing to collect some $20.000 from private donors.
We have created a database website and hired a team of experts to investigate non-transparent spending of public funds and check all cases that will be reported by citizens. The project was launched in March of 2018 and is supposed to run for the full year.
Lipa will collect and analyze the cases of wasteful spending and will present the government with ideas for policy improvement, such as more transparent budget, stricter audits of public bodies, limits on local authorities and so on. All the collected examples of wasteful public spending will be presented at a gala event at the end of the year.