MPs vote to increase VAT to 20 percent

Starting Oct. 1, value-added tax in Serbia will be 20 instead 18 percent, since the Serbian parliament adopted the amendments to the Law on VAT on Tuesday.

Izvor: Tanjug

Tuesday, 25.09.2012.

14:20

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BELGRADE Starting Oct. 1, value-added tax in Serbia will be 20 instead 18 percent, since the Serbian parliament adopted the amendments to the Law on VAT on Tuesday. An exception to the VAT increase would be implemented with basic food products the VAT of which will remain at 8 percent. MPs vote to increase VAT to 20 percent The VAT increase is expected to bring in around RSD 35 billion more funds in 2013, and 137 out of 250 MPs voted in favor of the amendments. VAT for baby products will total 20 percent but parents will have the right to VAT refunds in case their monthly income does not exceed RSD 80.000 and the value of their property is below EUR 200.000. Although opposition parties demanded during the debate that VAT for baby products should be reduced, Finance Minister Mladjan Dinkic said that the government opted for VAT refunds for parents so that parents and not retailers could derive benefits from this measure. Another novelty in the adopted amendments to the Law is embodied in the point which envisages that small and mid-size companies should as of next year pay VAT only after they charge the sold goods with a view to facilitating their business operations. Businessmen will now have a chance to pay back the tax-based debt within 24 months instead of 12 as was the case before the adoption of the Law. The amendments to the Law on citizens' income which the parliament adopted on Monday envisage that the tax rate for capital income, income from capital gains and revenues from personal insurance should be increased from 10 to 15 percent. The Serbian government assessed that the increase of tax rate for capital revenues would increase the inflow of public revenues by RSD 2.2 billion by the end of the year, while the increase in 2013 would total RSD 6.5 billion. A total of 136 MPs voted in favor of the amendments. Tanjug

MPs vote to increase VAT to 20 percent

The VAT increase is expected to bring in around RSD 35 billion more funds in 2013, and 137 out of 250 MPs voted in favor of the amendments.

VAT for baby products will total 20 percent but parents will have the right to VAT refunds in case their monthly income does not exceed RSD 80.000 and the value of their property is below EUR 200.000.

Although opposition parties demanded during the debate that VAT for baby products should be reduced, Finance Minister Mlađan Dinkić said that the government opted for VAT refunds for parents so that parents and not retailers could derive benefits from this measure.

Another novelty in the adopted amendments to the Law is embodied in the point which envisages that small and mid-size companies should as of next year pay VAT only after they charge the sold goods with a view to facilitating their business operations.

Businessmen will now have a chance to pay back the tax-based debt within 24 months instead of 12 as was the case before the adoption of the Law.

The amendments to the Law on citizens' income which the parliament adopted on Monday envisage that the tax rate for capital income, income from capital gains and revenues from personal insurance should be increased from 10 to 15 percent.

The Serbian government assessed that the increase of tax rate for capital revenues would increase the inflow of public revenues by RSD 2.2 billion by the end of the year, while the increase in 2013 would total RSD 6.5 billion.

A total of 136 MPs voted in favor of the amendments.

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