Ministry of Finance proposes increase of non-taxable salary components to RSD 15,000 – Amendments to tax laws prepared

The Ministry of Finance has proposed an increase of non-taxable salary components from the current RSD 11,790 to RSD 15,000, an extension of the validity period for exemptions for the newly employed until the end of 2019 and an implementation of new tax and contribution exemptions for newly founded companies, as stated in a range of draft laws pertaining to taxes, Tanjug reports.

The proposed amendments, which have been published on the website of the relevant ministry, also pertain to the Law on Mandatory Social Insurance Contributions. The period of implementation of certain exemptions is extended and a new manner of defining the minimum and the maximum amount of the base for calculating contributions is proscribed.

The minimum amount, as stated in the proposal of an amendment to Article 37 of this law, is 35% of the average monthly wage is Serbia in the period of the past 12 months, beginning with the November of the year preceding the year for which the contributions are calculated and paid.

Furthermore, the list of proposed amendments also includes the abolition of simple book keeping for entrepreneurs implementing the self-taxation system, an extension of the deadlines for tax return and payment of withholding tax to three days (as opposed to the current obligation of filing tax returns and paying on the same date)...

The obligation of filing VAT calculation overviews is extended until July 1, 2018, the stipulations regarding tax exemptions with the right of having previous VAT on the traffic of goods sent abroad by the passenger in their own luggage written off are changed and a special procedure of taxation for the traffic of investment gold is implemented.

The recent amendments also implement new electronic tax return forms for inheritance and gifts and the tax on transfer of absolute rights, which are to be implemented from January 1 next year.

The majority of the amendments are expected to come into effect on January 1, 2018, Tanjug reports.

Beginners in business to be exempt from taxes and contributions for two years

As Novosti reports in the issue of December 1, the planned amendments to the Personal Income Tax Law propose that new entrepreneurs should be exempt from paying salary taxes and contributions for themselves and nine employees in the first two years of operations. The condition is that the business is registered, that the workers and the entrepreneur are registered for mandatory social insurance and that the employees had been registered at the National Employment Service for at least six months before being employed.

The benefit is available only once and is not applicable if the entrepreneur starts a new business. It is not yet certain when the measure might come into effect, since the draft law cites July 1 and October 1, 2018, as potential starting dates, and it will be applied to entrepreneurs who start a business by the end of 2020.

The current tax exemptions for employers hiring new workers will continue being implemented. Under certain conditions, they have a right to a return of 65% and 75% of taxes and contributions. The measure should have expired on the final date of 2017, but the Ministry of Finance plans for its implementation to continue until the end of 2019, Novosti adds.

Ministarstvo finansija Republike Srbije

exemptions for beginners in business

exemption from taxes and contributions for beginners in business

Law on Mandatory Social Insurance Contributions

gray economy

Personal Income Tax Law

tax exemptions for employers

exemptions for employers

tax exemptions for entrepreneurs

non taxable salary components

Law on Value Added Tax

increasing non taxable salary components

defining the base for calculating contributions

contributions

taxes

tax

filing tax returns

exemptions for the newly employed

tax on inheritance and gifts

tax on transfer of absolute rights

book keeping