The reasons for the adoption of the amendments are predominantly:
- Harmonisation of the Serbian laws with EU laws. These amendments mean excise duties are imposed on electricity; and
- The amendments to the Excise Duties Act will serve as the basis for the realisation of the memorandum between Serbia and the IMF. These amendments should ensure further inflow into the Serbian budget.
By introducing a 7.5% excise duty on electricity, the Serbian government expects an annual inflow of additional RSD 17 billion ($158 million) in taxes each year.
In addition, by way of the latest amendments, liquids for e-cigarettes and smokeless tobacco products are now also subject to excise duties. The excise duty of RSD 4.00 per milligram of liquids will provide further inflow into the Serbian budget.
The main changes to the Excise Duties Act are the following:
- The scope of the Act is extended to cover electricity, smokeless tobacco products and liquids for e-cigarettes;
- The excise duty on smokeless tobacco will be levied per kilogram, and the excise duty rate will be 40% of the minimal excise duty on 1,000 cigarettes, assessed for the category of the average retail price of cigarettes;
- The excise duty on liquids for e-cigarettes will be RSD 4.00 per milligram of liquid;
- The excise duty on electricity for final consumption will be 7.5%. The base for the calculation of the excise duty shall be the price of electricity, which includes all direct expenses attributable to the delivery of the electricity;
- The payer of the excise duty is the supplier;
- The calculation period is a calendar month;
- The excise duties are due within 15 days from the end of the period in question;
- The following supplies are exempt from excise duties:
- Supply for business purposes of diplomatic and consular offices (under the reciprocity principle);
- Supply for business purposes of international organisations, if the exemption is provided for in an international agreement (under the reciprocity principle);
- Supply for private purposes of foreign staff of diplomatic and consular offices, including family members (under the reciprocity principle);
- Supply for private purposes of the staff of international organisations, including their family members, if such exemption is provided for in an international agreement (under the reciprocity principle);
- Supplies in connection with projects realised under international agreements, if such agreements provide for exemptions;
- Supply of electricity, which is used for production of electricity, in the process of cogeneration, and for self-supply of electricity producers;
- Electricity used in mines; and
- Electricity used for the proper operation and maintenance of the electricity distribution network.
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