Serbia: Proposed changes to income tax legislation
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Serbia: Proposed changes to income tax legislation

vucenovic.jpg

Gordana Vucenovic

At the beginning of May, Mladjan Dinkic, the Serbian Minister of Economy, announced that the government proposes the following changes in the area of income taxation:

  • Decrease of payroll taxes from 12% to 10%;

  • Increase of pension contributions from 22% to 24%; and

  • Increase in the limit of flat tax from RSD 3 million ($34,590) to RSD 6 million.

The changes are designed to benefit crafters and small and medium enterprises by increasing the limit for taxation.

Furthermore, the employers will be significantly relieved by reduction of payroll tax rate from 12% to 10% which on an annual level equals approximately RSD 2 billion, while the tax free income would be increased from RSD 8,700 to RSD 11,000.

On the other hand, the tax rate for pension insurance contributions would be increased from 22% to 24%, which would be a great benefit for the pension fund.

Mr Dinkic has also announced that there will be more changes to the tax laws, which would bring about RSD 30 billion savings by the end of the year. Some of the areas that will benefit most from those changes are agriculture and software engineering.

Gordana Vucenovic (gordana.vucenovic@eurofast.eu)

Eurofast Global, Belgrade Office/Serbia

Tel: +381 11 3241 484

Website: www.eurofast.eu

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