VAT after goods is paid, new Law on public procurement - What kind of economic policy is new government bringing?

Is our country nearing bankruptcy? Are we threatened by the Greek scenario? The unemployment rate officially increased to 25%. The house is on fire and it would be smart to extinguish the fire immediately. Are solutions in the coalition agreement which was signed yesterday by the leaders of the Serbian Progressive Party, coalition gathered around the Socialist Party of Serbia, as well as the United Regions of Serbia (Aleksandar Vucic, Ivica Dacic,Jovan Krkobabic, Dragan Markovic i Mladjan Dinkic) magical?

We will judge on that in the upcoming years.

eKapija selected the most important segments with respect to economic policy while you can have a look at the integral agreement PDF version.

The Program of Measures for budget deficit decrease will be passed on by the end of September after an insight in the real budget condition, an extensive analysis and serious consulting with businessmen, trade unions and public experts. On the one hand, measures must be radical when it comes to bureaucracy decrease and elimination of the unnecessary state expenses and on the other hand they have to be socially responsible when it comes to the most endangered society layers.

The Government of Serbia will continue talks with the International Monetary Fund and the World Bank in order to achieve macro-economic stability and sustainable trade development.

New coalition is announcing rationalization and decrease in budget deficit. All unnecessary expenses originating from the governmental administration will be eliminated. Instead of the fact that every ministry has numerous and uncontrolled income, all expenditures of ministries should be defined through budgetary procedure anticipated by the law and finance them from one resource –classic tax income.

October should see passing on new law on public procurement, which will increase the process transparency, decrease corruption and enable lower state expenditure. There will be no salaryand retirement compensation freezing, but their growth must be aligned with the real budget possibilities, respecting the principle that the retirement amounts should follow public sector salaries growth.

New Government is announcing cancellation of unnecessary fees and para fiscal impostsand the rest of the fees will be decreased to the level which will not halt private entrepreneurship development.

All republic imposts introduced by non-taxation laws. Small and medium-sized enterprises will be enabled to pay VAT after the goods is paid,not invoiced. Census for obligatory transfer of small companies to VAT system will be increased. This way, business of entrepreneurs with companies realizing low turnover would facilitate. When it comes to construction companies, it will be established that an investor isresponsible for VAT obligation of a contractor, if he does not pay the works within deadline.

Supporting of direct investments through the Agency for Foreign Investment and Export Promotion will continue.

The new Government will support entrepreneurs through grants and subvention loans. Special support will be provided to craftsmen by passing on modern Law on craftsmanship. Entrepreneurs dealing with information technologies and service export will be provided with significant support.

Changes in law will enable Tax administration, which has bigger potential to introduce order and prevent companies paying taxes and contributions within deadline, from competition which is not loyal, to takeover control of non-registered companies.

Looking up to Anglo-Saxon countries, Law on Managerial Responsibility will be passed on. It will include strict prison punishments and prohibition to perform managerial duty for long years incase the company is proved to avoid intentionally payments to suppliers by generating deliberate bankrupt of their companies. The jurisdiction reform will play the leading part in generating equal opportunities on the market.

Apart from that, new government will generate conditions to set updevelopment bank and double budget for agriculture.