Chamber of Commerce to push for VAT reduction

The Serbian Chamber of Commerce (PKS) will call on the government to cut VAT duty by one or 1.5 percentage points, PKS President Miloš Bugarin says.

Izvor: Beta

Monday, 10.08.2009.

18:34

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The Serbian Chamber of Commerce (PKS) will call on the government to cut VAT duty by one or 1.5 percentage points, PKS President Milos Bugarin says. Bugarin explained in an interview for Privredni Pregled magazine that the PKS’s proposal of measures that will lessen the consequences of the economic crisis is complete, and that it will include a decrease of income taxes on salaries from 63 to 50 percent, and profit taxes from 10 to eight percent, "and draconian punishment for those that do not pay". Chamber of Commerce to push for VAT reduction “Businesspeople have proposed a VAT decrease because that is the only way to see to their obligations amid the crisis and lack of money,” he said. Bugarin also said that the PKS will insist on arranging of ownership-related legal issues related to building land, abolishing limits set for investors, and a start of the restitution process, listing those as factors that are limiting investments in Serbia. “We know that these are hard measures and that they will have shock value, but without shock therapy, we cannot move on to serious reforms. In any case, the economic and financial crisis cannot be an excuse for a minute for reforms to be halted in Serbia,” Bugarin said. The economy, he continued, is "so weak and fragile" that it will need at least a year longer to recover compared more developed countries where the crisis first hit. Bugarin said that the state of the industry is best illustrated with the drop in production, which is highest in the manufacturing industry – at 25 percent, and the decrease in imports by 38.4 percent in the first half of 2009, and exports by 34 percent. “The serious reflections of the crisis will be felt in September, October and later,” he was quoted as saying. The number of companies with blocked accounts from October 2008, when the crisis began, to July 2009, increased by 15.8 percent and has reached 61,285, the PKS chief said. Bugarin explained that the total debt linked to the accounts increased by 56.2 percent, to RSD 262bn to 164bn. He told the magazine that the government’s package of crisis measures for helping those hit the hardest is “very late”, and added it should have been introduced along with the measures meant to boost the industry.

Chamber of Commerce to push for VAT reduction

“Businesspeople have proposed a VAT decrease because that is the only way to see to their obligations amid the crisis and lack of money,” he said.

Bugarin also said that the PKS will insist on arranging of ownership-related legal issues related to building land, abolishing limits set for investors, and a start of the restitution process, listing those as factors that are limiting investments in Serbia.

“We know that these are hard measures and that they will have shock value, but without shock therapy, we cannot move on to serious reforms. In any case, the economic and financial crisis cannot be an excuse for a minute for reforms to be halted in Serbia,” Bugarin said.

The economy, he continued, is "so weak and fragile" that it will need at least a year longer to recover compared more developed countries where the crisis first hit.

Bugarin said that the state of the industry is best illustrated with the drop in production, which is highest in the manufacturing industry – at 25 percent, and the decrease in imports by 38.4 percent in the first half of 2009, and exports by 34 percent.

“The serious reflections of the crisis will be felt in September, October and later,” he was quoted as saying.

The number of companies with blocked accounts from October 2008, when the crisis began, to July 2009, increased by 15.8 percent and has reached 61,285, the PKS chief said.

Bugarin explained that the total debt linked to the accounts increased by 56.2 percent, to RSD 262bn to 164bn.

He told the magazine that the government’s package of crisis measures for helping those hit the hardest is “very late”, and added it should have been introduced along with the measures meant to boost the industry.

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