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The Government of the Republic of Serbia

In the service of citizens

Decree on trade with Kosovo-Metohija to be amended soon

Belgrade, 9 February 2005

Director of the Tax Administration Vladimir Ilic said today that the Decree on trade with Kosovo will be amended soon to enable Serbian producers living in Kosovo to pay the value added tax (VAT) at the units of the Directorate for Public Payments in northern Kosovo-Metohija, and when the necessary technical conditions are created at the administrative line itself.

Vladimir Ilic at today's press conference

Ilic told a press conference that the tax police has received information that certain firms from central Serbia set up companies in Kosovo so that they could evade paying VAT by fictive export of goods.

According to Ilic, 72,426 declarations for sales tax exemption were issued to taxpayers in 2003 and 2004. Some companies from Serbia used these declarations to avoid paying tax. The majority of goods with tax reliefs remained in central Serbia and were placed on the market through illegal channels without previous payment of sales tax, the Director of Tax Administration specified.

Speaking about the submittal of tax returns, Ilic said that closing January 31, 2005 there were 11,000 newly registered income taxpayers. All citizens who have not reported their property can do so by February 10.

Closing February 8, a total of 532 VAT tax returns have been submitted, of which 471 were correct and 61 incorrect. This is a positive signal that taxpayers in Serbia have taken seriously the process of submitting the tax returns, since in Macedonia every sixth tax return was incorrect at the beginning of the process.

He recalled that February 10 was the final deadline for submitting VAT tax returns for January 2005, and that registered taxpayers who turned over more than 20 million dinars in the past 12 months or who plan to make such turnover in the next 12 months are obliged to apply for VAT.

Noting that the turnover in January was lower than in the months before, he said that effects of VAT payment will be known a few days after submission of tax returns.

The deadline for submitting tax returns for annual income for citizens who exceeded the limit of 986,640 dinars for this year is March 15, according to Ilic.

Ilic also said that the deadline for paying the first instalment of the advance tax on property is February 15 this year, noting that taxpayers are obliged to pay a quarter of their obligations for the property tax.