The Croatian Tax Administration takes the view that, for VAT purposes, a structure weighing 47 tons, anchored into the ground, connected to electricity, water, sewage and other infrastructure by fixed connections, incapable of being easily dismantled or relocated, requiring considerable effort and cost to remove, and requiring a building permit under the Croatian Building Act, should not be regarded as a building.

The Croatian Tax Administration has publicly published an opinion (Class No. 410-19/26-02/215, Ref. No. 513-07-21-01-26-2, dated 14 August 2026) from which it is apparent that it received a query concerning a structure formally named as a “tent”, while at the same time setting out in detail all of the above characteristics, including the fact that the structure weighs 47 tons and requires a building permit under the Croatian Building Act. Nevertheless, the Tax Administration concluded that this “tent cannot be regarded as a building, nor can the supply and installation of the tent be regarded as a construction service”.

Such a conclusion is not in line with the case law of the Court of Justice of the European Union, e.g. C-315/00 Maierhofer, according to which the classification of immovable property depends on the actual characteristics of the structure, including its connection to the ground and the ease (or lack thereof) with which it can be dismantled or relocated. Likewise, it is apparent that the officials of the Croatian Tax Administration who prepared the opinion failed to take into account the detailed guidance contained in the Explanatory Notes on EU VAT Place of Supply Rules on Services Connected with Immovable Property (issued by European Commission), which in the context of explaining the term “constructions” specifically emphasize that the assessment must be based on the actual characteristics of the structure rather than on its formal designation.

In those Explanatory Notes in the context of answering the question “What is meant by buildings and constructions under Article 13b(b)?”, European Commission states :

• “The term ‘construction’ has a broader meaning and encompasses other (man-made) structures that do not typically qualify as a building…”.

In those Explanatory Notes in the context of answering the questions “What is meant by ‘fixed to or in the ground (above or below sea level)’ and ‘which cannot be easily dismantled or moved’? “ European Commission states:

• “While buildings or constructions requiring major infrastructure works to attach them to the ground would obviously meet these criteria, concerns may be raised in situations where the nature of the building or construction or the type of ties used to fix it to the ground might be questioned. A houseboat used as a restaurant-discotheque in the circumstances referred to in the Leichenich case or the buildings constructed from prefabricated components intended to be removed and re-used on another site in the circumstances referred to in the Maierhofer case are illustrative in this respect.”
• „A building or construction can be fixed to or in the ground by different means: by a binding material such as cement, by an attachment such as ropes, chains, bolts or anchors.”,
• “However, what will be decisive in considering a building or construction as an immovable property is whether it can or cannot be easily dismantled or moved.”,
• “In accordance with the case-law of the CJEU, it is not necessary for a building or construction to be indissociably incorporated into the ground in order to be regarded as immovable property. What needs to be checked is whether the measures taken to immobilise cannot be easily undone, that is to say without effort and considerable cost. “

The wording of the opinion of the Croatian Tax Administration gives the impression that decisive weight was attached to the formal label of the structure (“tent”), rather than to its actual technical and functional characteristics.

This opinion of the Croatian Tax Administration should also serve as a warning to taxpayers that particular care should be taken when choosing the wording and descriptions used in communications with the Tax Administration. At the same time, it illustrates why the correct VAT treatment of a transaction should never be assessed solely on the basis of individual opinions issued by the Tax Administration, but rather by reference to the applicable legislation, European Union law and relevant case law.