Montenegrin Cabinet discusses hydrocarbons tax bill, health and safety at work, tourism

Podgorica, Montenegro (7 February 2014) – At yesterday’s session, the Montenegrin Cabinet approved the Hydrocarbons Tax Bill. The proposed law introduces the new tax levy and creates tax policy on profit gained from extracting oil and gas from reservoirs, and from the construction or use of facilities and related equipment for production, delivery and transport of oil and gas. 

Having in mind it is about the exploitation of non-renewable natural resources, the Government decided to define the oil industry tax system in according to the extra tax model, while at the same time creating conditions for establishing a long-term system of taxing hydrocarbons income.

The law provides for a tax rate of 59%. Twenty per cent of revenues gained from upstream activities taxation will be directed to the Montenegrin Budget, while 80% will be allocated to a special fund, which will be used for funding development projects of national interest.

In the process of harmonisation of national labour legislation with the regulations of the International Labour Organisation and the European Union, the Government approved the Law on Health Protection and Safety at Work. The piece of legislation prescribes some novelties that, in addition to technical protection measures, refer to the introduction of the employee’s health component and expand duties and responsibilities of the relevant parties in the workplace. At the same time, its adoption meets the criteria for increasing quality and competitiveness of the business market, as well as for Montenegro's integration into the international labour market.

The Cabinet also approved Thursday the Bill Amending the Law on Tourism, which will contribute to better regulation of the area of providing services in tourism in line with modern trends, thus providing greater legal security for businesses. Among other things, the updated legal regulations redefine conceptual as well as essential meaning of the terms “resort” and “tourist resort”, which are legally regulated as single functional units owned by a single legal entity and can not be subjected to partial divisions.