From October 1, 2022, the VAT rate of 0% will be reintroduced!
The use of the stated rate was cancelled in 2013 when, as an adjustment for the entry of the Republic of Croatia into the EU on July 1 of the same year, a rate of 5% began to be applied to bread, milk, scientific journals and others, since the EU VAT Directive did not allow the application of a reduced VAT rate less than 5%. On April 6, 2022, the Council's Directive was amended in such a way that it enables member states to apply a reduced rate lower than the lowest allowed 5% to exactly prescribed deliveries of goods or services. The limited list also includes the delivery and installation of solar panels on private residential buildings, residential premises and public and other buildings used for activities of public interest, as well as the delivery and installation of solar panels near such buildings, premises and buildings that are now taxable at a rate of 0%.
The taxpayer has the right to deduct input VAT related to these supplies.
An amendment to the VAT Ordinance is expected with an adapted I-RA book and VAT form, which also include a display of deliveries at a rate of 0%.
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