Drobnjaković: ‘Payroll tax and contributions should be reduced for all entire economy, not just certain categories’

“It would be more efficient for the state to reduce the payroll tax and contributions for all workers, instead of reducing the burden only for certain categories of workers,” the director of the Union of Employers of Serbia, Srdjan Drobnjaković, said today.

Yesterday, the President of Serbia, Aleksandar Vučić, announced a 70% reduction in taxes and contributions on salaries for people who are first-time employed, those under 40 years of age and workers engaged in research and development, as well as exemption from taxes on annual income for people earning more than 2.9 million dinars.

“Even if the total burden on everyone’s salaries were reduced by half or 1%, it would have a greater effect than reducing taxes for just one category of employees for a period of three years,” Drobnjakovic said.

Slobodan Djinovic, of the Economic and Social Council, says that, several months ago, the Council sent to the Serbian government an official letter with a request for the payroll tax to be reduced. “The payroll tax currently stands at 61% (of the gross salary) and is unbearable. If it were reduced by several percentages, the shadow economy would definitely be affected,” said Djinovic.

He added that reducing payroll and contributions would also improve the economic environment, which would become more attractive for investors, adding that reducing the tax burden by 70 per cent on the salaries of workers under the age of 40 could be a good incentive for self-employment and small businesses, but that large companies will not consider it.

Djinovic went on to say that the 70% tax reduction could also be useful in prevent young people from leaving the country and starting a business in Serbia.

(Novi Magazin, 17.06.2021)



This post is also available in: Italiano

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