Taxation policies of Croatia: Proposals for implementation of preferential tax regimes on islands
What causes growth and development of a Croatian island? Could preferential tax regimes be one of the solutions to the challenges of Croatian islands without leading to base erosion and profit shifting? The primary goal of this thesis was to analyse the factors that influence the growth of Croatian islands and suggest possible solutions for increasing that growth within the international scope. The literature review performed identifies the several factors influencing the growth of a Country or an Island. A multivariate regression analysis of specific factors was used to develop a parsimonious model. The results show that tax, political, demographic factors affected the GDP of a Croatian island, with certain limitations. The possible solutions for increasing growth within these factors using preferential tax regimes included decentralisation, incentives for population growth, and changes in fiscal regulations.