There are 68,500 companies in Serbia that operate unregistered, which is 17% of the total number of business entities in the country – a shadow economy study done by the National Alliance for Economic Development (NALED) has shown.
NALED also points to the lack of inspectors, stating that there are 820 business entities to one field inspector of the Tax Administration, with the situation with labour inspectors even worse – 1,500 companies per one labour inspector.
Amendments to the Inspection Supervision Law, which should be adopted by the end of the year, will bring a novelty called “trusted business entities”, which should improve the efficiency of inspections and make it easier for responsible companies.
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“Business entities that have a positive business history can expect that, in the next 4 years, they will not be subject to inspection supervision but will have an obligation to carry out a self-assessment, that is to conduct a kind of self-examination of their operations,” says the Minister of Public Administration and Local Self-Government, Branko Ružić.
The Norwegian Ambassador to Serbia, Arne Sanes Bjornstad pointed out that inspections are indispensable for the functioning of the rule of law and the efficiency of the economy, and that the use of information technology and co-operation between inspectors give better results at a lower cost.
“The new law will put Serbia in the group of countries with a more modern approach to inspections, which includes soft contact and control based on risk analysis, which facilitates the life of a business that operates in accordance with the law and makes it more difficult for companies that do business contrary to the existing regulations,” says Bjornstad.
“Over the past year, more than 12,000 supervisions have been carried out in companies suspected of being unregistered. The inspectors found out that as many as 30 percent of these companies proved to be unregistered”, said Goran Kovačević from NALED and added that lack of inspectors posed a major problem.
“NALED’s Study on Shadow Economy from 2017 found that 17% of all businesses, i.e. more than 60,000, operate as unregistered entities”, explains Kovačević and adds that there are 820 business entities to one inspector of Tax Administration, as well as 1,500 companies to one labour inspector.
According to the Inspectorate’s data, the inspectors found 22,000 undocumented workers last year, and this year, more than 12,500 undocumented workers were found.
The Inspectorate and the Ministry of Labour have recently published the name of blacklisted employers who are known for having undocumented workers. The inspectors have also pointed out that lax policy towards such companies is a major obstacle in their work.
The public debate about the amendments to the Inspection Supervision Law was organized by the Ministry of Public Administration and NALED, with the support of the Embassy of Norway.
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