In order to manage the capital they own and do business, the state and other public entities usually start government owned enterprises, of which the number, size and diversity by economic sectors vary from country to country. This paper deals with the role in public finances that government owned enterprises have in the Republic of Croatia. Questions raised, among others, are, could the revenue from government owned enterprises make a significant portion of the state revenue, what is the future of government owned enterprises in Croatia and, also, which social issues should the state try to influence through the government owned enterprises and within what kind of European and Croatian legal frame. By examining state documents related to management of the government owned enterprises and their role in public finances, scientific papers on the same topic and European and Croatian legal norms regarding the position of state owned enterprises on the market, it is revealed that the Republic of Croatia, through its enterprises, still owns significant capital. However, due to certain social factors, the potentials of state owned enterprises are not being reached. Therefore, reforms are suggested, for which it is believed that they would help the government owned enterprises with sustaining their two primary functions: reaching specific social goals and obtaining profit.