Assessment of impact of accession to the EU on Croatian budget

Accession to the European Union has two eff ects on the general government budget of a new member state. A new member state is obligated to transfer a part of its revenue to the EU budget according to predefi ned criteria, while on the other hand it can draw funds from the EU budget. Harmonization of the tax and customs system with EU standards has also signifi cant impact on the general government budget of a mem ber state. From 2005 to 2009, the ten new member states observed drew from the EU budget more funds than they paid in, by an average amount of about 1.5% of GDP. The total estimated expected impact of Croatian accession to the EU on the general government budget in the fi rst full year of membership is negative, amounting to about -0.15% of the GDP. Considering the high defi cit of the general government budget, Croatia should ensure good preparation for EU entry in order to maintain the level of the defi cit below 3% of GDP. However, the good news is that Croatia should be a net recipient of funds from the EU budget in the amount of 0.83% of GDP in the fi rst full year of membershi