Slovenia's Intervention Act on the horizon: how will it affect your business?

On 11 May 2026, the Slovenian Parliament adopted the Act on Intervention Measures for the Development of Slovenia (Zakon o interventnih ukrepih za razvoj Slovenije, "ZIURS"). The reforms are broad in scope, spanning income tax, social security contributions, VAT, employment law, pensions, long-term care and healthcare. Taken together, they signal a meaningful shift in Slovenia's economic policy framework for businesses and investors alike.

VAT reductions on food and energy

ZIURS introduces the following VAT reductions:

• a permanent reduction of the VAT rate from 9.5 % to 5 % on 15 categories of basic staple foodstuffs, as well as seeds, seedlings and fertilisers; and
• a temporary reduction of the VAT rate from 22 % to 9.5 % on electricity, natural gas, district heating and firewood for the period from 1 July 2026 to 31 March 2027.

The measure is driven by the recognition that VAT is ultimately borne by the end consumer and aims to alleviate the impact of inflation on the most vulnerable groups stemming from the current geopolitical instability.

Tax reliefs for sole proprietors

ZIURS introduces certain tax reliefs with respect to the regime of sole proprietors applying lump-sum expenses. To qualify as a full-time flat-rate sole proprietor (polni normirani s. p.), individuals will now need only five months of compulsory self-employment insurance, down from the previous nine-month requirement.  
The scale of recognised flatrate expenses is also revised.

Key changes include:

• the deductible percentage now decreases in steps as revenue grows (previously, full-time flatrate sole proprietors could either deduct 80 % or nothing at all), allowing sole proprietors to earn significantly more while still benefiting from the flatrate regime;
• the maximum revenue thresholds for remaining in the system have been in-creased from EUR 60,000 to EUR 150,000 for full-time and from EUR 30,000 to EUR 70,000 for part-time flat-rate sole proprietors, opening the system to a wider range of businesses; and
• the reintroduction of a flat tax rate of 20 % for flatrate sole proprietors.

ZIURS further establishes the category of so-called "micro sole proprietors", providing relief to self-employed individuals and farmers whose annual income corresponds to the minimum wage. For these taxpayers, the contribution base for compulsory pension insurance is set at a maximum of 45 % of the minimum wage (previously 60 % of the average wage). 

Cap on social contributions

After several unsuccessful attempts in the past, ZIURS introduces a monthly cap of EUR 7,500 (razvojna kapica) on the base for calculating social security contributions. By limiting social contributions, employers can offer higher net pay to skilled employees, making it easier to attract and retain top talent.

There is, however, a partial offset. As income tax is calculated on gross salary minus social contributions, lower contributions result in a higher taxable base. Consequently, employees earning above EUR 7,500 per month will see a meaningful net benefit, although not the full value of the contribution savings.

 
Changes affecting employers and employees

• In the employment relationship area, ZIURS introduces the following key changes:automatic (ex lege) termination of the employment contract on the day the employee becomes eligible for old-age pension – an employee wishing to continue working must notify the employer in writing no later than 90 days before reaching pension eligibility; and
• a "dual status" concept, enabling employees who meet old-age pension conditions and continue working to hold both insured person and pension beneficiary status simultaneously, with a guaranteed 100 % pension payment (previously capped at 40 %), intended to incentivise continued employment and mitigate the labour market pressures arising from demographic decline.

Transitional rules for short-term rentals  

ZIURS introduces the following transitional measures affecting short-term rentals:

• the newly adopted Hospitality Act (ZGos-1), which brought important amendments for short-term rental providers, is temporarily suspended until 31 December 2026, with the previous Hospitality Act (ZGos) becoming applicable again in the interim;
• time limitations on short-term rentals in municipalities with a high risk of negative impacts will not apply in 2027 – in practice, this means that short-term rental providers will not be subject to any maximum number of days during which they may offer their services (ZGos-1 set the cap at 60 days per calendar year or between 30 to 270 days per calendar year if so determined by a municipality's general act).

The road ahead

ZIURS has not yet entered into force. Trade unions have initiated proceedings to call a subsequent legislative referendum. On 27 May 2026, the National Assembly adopted a resolution declaring the referendum inadmissible. The initiators of the referendum now have 15 days to file a request for a review of the constitutionality of that decision before the Constitutional Court, which shall render its decision within 30 days of receipt of such request.

Further developments will be monitored and covered as the situation unfolds in the coming months.