Why is government reluctant to abolish para-fiscal charges?

Apart from taxes, a company in Serbia also has to pay dozens of non-tax charges every month, or, on average, 66 local administrative fees for issuing of various permits, notices and official compliances plus there are several other local fees.

These charges have been burdening Serbian business for years now. In order to deal with the problem, Serbian Ministry of Finance announces adoption of a new law that is supposed to bring some order and transparency into this segment. The Ministry says that the law is currently being drafted, and that its aim is to “regulate rational utilization of public goods, establishment of a uniformed fee registry, and reducing the number of para-fiscal charges to a reasonable level”. The draft law is supposed to be finished by the year end.

Milenko Marjanovic, the proprietor of the Sumarice catering facility in Kragujevac, has 120 employees. He says that, every month, he has to set aside 33,000 EUR for various tax and non-tax charges. “I pay regular taxes, of course, and then there are various fees and charges that are simply a burden to our operations”, he says. Catering facilities have over 50 non-taxes charges to pay, and this number varies from municipality to municipality.

Para-fiscal charges include all payments that the citizens and businesses pay to the state, and do not obtain any right, service or goods in return, or the things they get in return are disproportionately little. The Study on Para-Fiscal Charges, created by NALED in cooperation with USAID BEP project, identified 371 non-tax charges, out which at least 179 are para-fiscal charges.

(N1, 01.02.2017)



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