Serbia ready to open taxation chapter

On Thursday, May 27, in the National Assembly, at the initiative of the Committee on European Integration, the representatives of the Ministry of Finance and the Ministry of European Integration, members of Parlament and representatives of the National Convention on the European Union attended a meeting presenting the Summary of the Negotiating Position of the Republic of Serbia for Chapter 16 - Taxation.

This important economic chapter is not open for negotiations with the EC, considering that the criterion for its opening is a condition regarding the equalization of the amount of excise burden on strong alcoholic beverages.

In mid-May, the Government of Serbia passed amendments to the Bill on Excise Duties which is currently in the parliamentary procedure, and the proposal stipulates that excise duty should be calculated according to the percentage of alcohol contained in a specific drink, and not according to the type of drink (fruit brandy and grain brandy), which has been the case so far.

This way, fiscal discrimination that has existed for almost two decades between domestic producers and importers of strong alcoholic beverages will be eliminated. More importantly, this change will enable the opening of cluster 3 - Competitiveness and Inclusive Growth, encompassing this negotiating chapter, with five open chapters (two are temporarily closed) out of a total of eight, while the chapter of taxation is currently among the three unopened (in addition to Chapter 10 - Information Society and Media, and Chapter 19 - Social Policy and Employment).

NCEU Coordinator Nataša Dragojlović and Coordinator of the Working Group for Chapter 16 Jelena Rančić pointed out that the amendment to the Law on Excise Duties fulfilled the key recommendation given in the Book of NCEU Recommendations for 2019 (in Serbian) and 2020, as well as in the policy summary on equalization of excise duty alcoholic beverages (in Serbian) prepared by NALED, as the coordinator of the Working Group for Chapter 16, in cooperation with the Center for European Policies (CEP) and the European Western Balkans.

Representatives of NCEU commended the efforts of the Ministry of Finance to prepare a draft law on amendments to the law on excises, organize a public debate and consultations with stakeholders in a short time period.

Based on the discussion and a more detailed explanation of the planned harmonization with EU Directives in this area, including proposals for transitional periods until full harmonization with regulations in the field of taxation, NCEU representatives agreed with the Summary of the negotiating position.

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