In the latest issue of the IPF Note, Romario Marijanović analyses how the fiscal picture of tourism-intensive local government units changes when tourists are also taken into account, alongside permanent residents, as users of local services and infrastructure. Although units with higher tourism intensity generally record higher revenues and expenditures per permanent resident, the disparities in selected expenditure categories narrow significantly when tourists are included among potential users.

The analysis covers 381 Croatian cities and municipalities with available data on tourist overnight stays in 2025. Local units with higher tourism intensity generate higher revenues, particularly from taxes, fees and charges, and property income. In the group with the highest tourism intensity, fiscal capacity per resident is approximately 2.6 times higher, while total expenditures per resident are about 1.8 times higher than in the group of local units with the lowest tourism intensity.

However, a comparison based solely on the number of permanent residents does not provide a complete picture, as tourists also use local services. For this reason, the analysis focuses on expenditures on environmental protection and housing and community amenities. Per permanent resident, these expenditures are approximately 81% higher in units with the highest tourism intensity than in those with the lowest. However, when tourists are also included among potential users, this difference narrows significantly to about 17%. The author therefore highlights the importance of taking tourists into account when assessing expenditures in tourism-intensive local units. The same issue may also be relevant for other local services used by both permanent residents and tourists.

The IPF Note was prepared as part of the Croatian Science Foundation project Fiscal decentralization in Croatia – current state, challenges, and potential solutions (FISDEC).

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