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Serbia: Amendments to VAT law; generally effective in 2020

Serbia: Amendments to VAT law; effective in 2020

Serbia’s Parliament on 7 October 2019 passed legislation that amends the value added tax (VAT) law.

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These VAT legislative measures, published in the official gazette (no. 72/2019), generally are effective 1 January 2020. Certain provisions are effective in 2019.

Among the VAT measures included in the new law are the following items:

  • The legislation introduces the concept of a voucher and allows for different VAT treatment of single-purpose and multi-purpose vouchers.
  • The new law clarifies that the obligation of a foreign entity to appoint a tax proxy and register for VAT in Serbia also exists in instances when the foreign entity provides a supply of goods or services that may be entitled to a VAT exemption for input VAT deduction purposes.
  • There are new rules for determining the place of supply of goods and services (including those supplied on a boat, aircraft or train).
  • The new law stipulates that the VAT liability arises on the day when the invoice is issued for the supply of services directly related to intellectual property rights, regardless of the person providing those services, as well as for technical support services for the use of software, hardware, and other equipment for a specified period of time.
  • There is a new VAT exemption for which an input VAT deduction is available for the supply of goods and services performed as part of completion of an infrastructural project (highway construction).
  • The legislation includes amendments to the rules for VAT refunds for foreign passengers and the rules for VAT exemption for the import of the goods for repair within a warranty period.

Read an October 2019 report prepared by the KPMG member firm in Serbia

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