The economy has declined by over a quarter in the past decade

According to the latest analyses conducted as part of the Better Way Initiative, Serbia has reduced its shadow economy from 29.1% to 21.1% of GDP over the past decade. This was announced today during the celebration of ten years of joint efforts by the Serbian government and NALED against the shadow economy.

Ten key reforms that contributed to these results include the introduction of the eFiscalization and eInvoice systems, the adoption of the Inspection Supervision Law, and the implementation of eInspector, electronic public procurement, cashless payments for electronic services, reform of flat-rate taxation and freelance work, reform of seasonal worker engagement in agriculture, the unified eRegistration and obtaining a PIB at the APR, reduction of wage tax burden, and the launch of the eTaxes portal.

Serbia's First Deputy Prime Minister and Minister of Finance, Siniša Mali, stated that research shows positive trends, and confirmation that the country is on the right reform path is reflected in Serbia receiving an investment rating for the first time.

“To further facilitate the operation of the economy, we will soon introduce the eExcise and electronic shipping documents systems. We are also working on a new IT solution for the Tax Administration. A new application is planned where citizens and businesses can view all their tax obligations in one place,” announced Mali, who chairs the Government's Coordination Body for the fight against the shadow economy.

NALED Executive Director Violeta Jovanović emphasized the results of the Ministry of Finance and reminded that in 2014, NALED established the Fair Competition Alliance, which that same year sent an initiative to then-Prime Minister Aleksandar Vučić to create a joint group to systematically address the issue of the shadow economy.

“Digitalization is the common denominator of the key reforms and initiatives supported by NALED, including the lottery ‘Take a Receipt and Win,’ which, thanks to the efforts of the Tax Administration and the Better Way Initiative, this year reintroduces cashless payments as a double chance for all citizens who pay by card or instant transfer,” highlighted Jovanović.

Through the Better Way Initiative, with the support of the German government and companies like Mastercard and Visa, subsidies have been provided to micro and small enterprises for the free introduction of POS terminals with reduced merchant fees.

“In just a year and a half, we have over 5,000 applications, and small traders who have introduced POS with our support have achieved 1.5 million transactions worth over 18 million euros,” added Jovanović.

Simon Christian Blum, Deputy Director of the Public Finance Reform Project - Agenda 2030 from the German organization for international cooperation, GIZ, confirmed that cashless payments are key in the ongoing fight against the shadow economy.

“The latest analysis shows that bringing Serbia closer to the EU average in the development of cashless payments could reduce the shadow economy by up to 2.4% of GDP and generate nearly 500 million euros in additional tax revenue annually,” said Blum.


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