At the press conference held on 31 March 2020, Mr. Siniša Mali, Minister of Finance, and Mr. Marko Čadež, President of Serbian Chamber of Commerce, announced set of measures intended to boost economy in order to ease consequences of the crisis caused by COVID-19.
As the goal of measures is to preserve the number of employed citizens and support companies whose business is affected during the state of emergency, it is suggested that measures will not apply to:
Suggested Program of Economic Measures consists of four groups:
I. Tax policy measures,
II. Measures of direct financial aid to private sector,
III. Liquidity measures in private sector,
IV. Other measures.
I. Tax policy measures
This set of measures is related to deferral of tax payment with obligation of repayment of deferred taxes in instalments, not earlier than beginning of fiscal year 2021, and includes the following measures:
Respective measures will apply equally to all companies irrespective of their size or economic strength.
Total projected value of the measures is RSD 161 billion (cca. EUR 1.37 billion).
II. Measures of direct financial aid to private sector
This set of measures is related to direct payments and aid to the business entities and entrepreneurs with a goal of continuity of salary payments, and includes the following measures:
Listed measures will not limit number of employees who are on paid temporary leave by employer’s decision, nor amount of rights which is determined by employer during the leave.
Total projected value of these measures is RSD 97.3 billion (cca. EUR 828 million).
III. Liquidity Measures for private sector
This set of measures is related to financing loans and guarantee scheme which will be provided with a goal of liquidity improvement during and after the state of emergency, and includes the following measures:
1) Financial support through loans for perseverance of liquidity and working capital for entrepreneurs, micro, small, medium entities, agricultural farms and cooperatives. As a part of the Program, Serbian Development Fund will offer loans in the total amount of RSD 24 billion (cca. EUR 200 million). Repayment period will be 36 months with 12 months grace period. Maximum financial support is also envisaged:
2) Financial support through guarantee scheme provided by the Republic of Serbia to commercial banks which are present in Serbia, for loans in EUR and RSD for perseverance of liquidity and working capital for entrepreneurs, micro, small, medium entities and agricultural farms. Repayment period will be 36 months with 12 months grace period. Maximum value of the loan which can be granted through this program is envisaged to be 25% of revenues in 2019 or EUR 3 million.
Total projected value of the measure is RSD 240 billion (cca. EUR 2 billion).
IV. Other measures
This set of measures is related to stimulation of domestic demand and perseverance of liquidity of business entities, and includes the following measures:
1) Direct aid to Serbian citizens older than 18 year through one-off payment in the amount of EUR 100 for the purpose of stimulation of domestic demand. Total projected value of the measure is RSD 70 billion (cca. EUR 596 million).
2) Moratorium on dividend payments (except for state owned enterprises).
Please note that Decrees for implementation of announced measures are expected in the next 10 days
It will be necessary to see exact texts of decrees in the Official Gazette to have the full and clear picture of the qualifying entities, procedure and timelines.
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