LUMP SUM TAXPAYERS CAN NOW CALCULATE TAX LIABILITIES FOUR YEARS IN ADVANCE

18. November 2019.

All lump sum taxpayers and those just planning to start a business will now be able to calculate their tax liabilities four years in advance on www.jpd.rs .

This has, so far, not been the case and there has been no clear rule on when tax decisions arrive, nor what amount they could expect. The illustrative calculator, developed by NALED, in cooperation with the Tax Administration under the USAID-funded Public-Private Dialogue for Development Project, was presented at a roundtable held at the Vojvodina Chamber of Commerce.

At the first of the four planned roundtables, the draft regulation on lump sum taxation will be presented to the public.

The change brings automation of the procedures, reduced bureaucracy and more predictability in determining tax liabilities to 117,000 lump sum taxpayers in Serbia.

“Beginners in business will be able to find out electronically whether they have the right to operate as lump sum taxpayers and, as the existing entrepreneurs, calculate in advance the amount of taxes. Instead of an advance and final tax decision, which was often more than six months late, they will electronically receive a single tax decision electronically for the year in advance, "said Jelena Bojovic, Director of regulatory reform at NALED.

NALED and the Entrepreneurship Development Association launched a lump-sum tax reform initiative last September. The draft regulation, which is expected to be adopted in December and will enter into force in January 2020, provides for a number of facilities for many lump sum taxpayers.

Over the next three years, their tax liabilities cannot be increased by more than 10 percent annually, and for many entrepreneurs they will be reduced by 30 percent or more because of a new tax calculation formula that provides objective and easily verifiable criteria for setting the amount against the existing model.

Also envisaged is a reduction of the tax base during the first three years of business operations, as well as of the tax base for entrepreneurs under 30 and over 55 years of age, for women who have just given birth, disabled persons and persons suffering from long-term illnesses. The regulation provides that both car mechanics and accountants will be able to operate as lump sum taxpayers in the future.

Source: Business Morning and Coordination Body