The Law on Foreigners was adopted by the Croatian Parliament last week only two months after the prime minister Andrej Plenkovic tweeted that Croatia would be the second country in Europe to be issuing Digital Nomad Visas. But it is still not clear what exactly you will need for the Croatian Digital Nomad Visa.
This news has sparked interest among the global digital nomad community, which is eagerly anticipating requirements for the visa. The main question being: Will there be a minimum income?
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Estonia, who introduced the Digital Nomad Visa back in August, is allegedly the example Croatia is following. Estonia does have a minimum salary requirement for obtaining the visa. The applicant needs to have at least 3504 euros for the first month of his stay, which is higher than Estonia´s average gross salary of 1433 euros. Croatia’s average gross wage is 1182 euros, so it is reasonable to expect that the minimum income required for the Croatian visa will be lower.
On the other hand, Georgia, another country that decided to introduce the Digital Nomad Visa, has an average salary of 295 euros, and the minimum income requirement for the visa is 1690 euros..
What will the Croatian authorities decide we are yet to see.
Free healthcare for Digital Nomads
Healthcare will most likely be another requirement for the applicants of the Digital Nomad Visa. It is likely they would have to subscribe to a private insurance. There is some news on that front coming from the first digital nomad conference in Dubrovnik – Dubrovnik for digital nomads.
Saltwater, a company at the forefront of the Nomad revolution in Croatia, organized the conference during the global freelancer week, from the 16th to the 25th of October. It featured speakers from all over the world covering topics from nomadic lifestyle to taxes and healthcare.
At the conference, Nikola Kurtela, the representative of the Polyclyinc Glavic based in Dubrovnik, announced that they would offer free healthcare for one year to anyone with a digital nomad visa. Fantastic news, while we are waiting for more concrete information about the visa requirements from the authorities.
No income tax?
The Digital Nomad Visa has its critics in Croatia, as some perceive it as a tax-avoidance scheme. For the time being, the authorities have not announced how the taxation will look like. But it would seem that they’d be exempt from paying the income tax.
In this scenario, Croatian authorities still hope to benefit from nomads through their spending. The spending power of a western worker, especially in sectors such as IT, is double if not triple the spending power of a Croatian worker, making them the perfect tourist. But no more than that, as we can see in the next paragraph.
The employer cannot be in Croatia
The Law on foreigners stipulates that workers with this type of visa would not be able to offer their services or work for Croatian employers, and the employer – whether it is the person is self-employed or working for a company – needs to the registered outside of Croatia. In other words, Croatia can not be a tax residency of Digital Nomad Visa holders.
This kind of condition robs the nomads of the opportunity to truly integrate, and the Croatian labour market – already suffering from a bad case of “brain drain” as more than 200 000 people have left the country since 2013 – of the chance to receive some fresh blood and knowledge.
A third-country national who is employed or performs work through communication technology for a company or his own company that is not registered in the Republic of Croatia, and does not perform work or provide services to employers in the territory of the Republic of Croatia.Definition of a Digital Nomad in the Croatian Law on Foreigners
Even though Croatia looks at Estonia as the role model, they can hardly implement all the changes Estonia worked on for two years in only four months. Estonia’s E-residency (not the same as the Digital Nomad Visa) allows foreign workers to open companies in Estonia remotely. At the same time, Croatia only seems to be focused on the Digital Nomad Visa.
Let us hope this is the first step towards a model that resembles Estonia, and not a quick fix for the hit Croatia as a tourist country will suffer from the Corona crisis.
While we are waiting to learn more about the specifics of what you will need for the Croatian Digital Nomad Visa, the tourism sector is slowly preparing to welcome digital nomads. Hotels and apartment owners are offering extended stays, putting work desks in the rooms, advertising on digital nomad groups and forums, and adding #digitalnomadlifestyle to their social posts.