Information of the Ministry of Finance on the occasion of the Statement of Employers Association in reference to new tax solutions

On the basis of the Law on Amendments to the Law on Personal Income Tax, and the Law on contributions for compulsory social insurance, the personal income tax decreased from 12 to 9%, as well as contributions charged to employer from 14.5% to 9.8%, and total aunt of contributions for compulsory social insurance increased from 32 to 33.8%. In this way, contributions charged to employee increased, while contributions charges to employer decreased by 4.2 percentage points. The increase in contributions charged to employee and decrease in net income is not jeopardizing the liquidity of any company in Montenegro. On the contrary, the reduction of the total earnings expenditures, employers are given the option to generate the same level of expenditures for payment of earnings, by decreasing contributions charged to employees along with a minor decrease in net earnings. For example: if the agreed gross earning amounted to 641 Euros, and the net earning amounted to 460 Euros, the total employers expenses amounted to 745 Euros. Proposed legislation envisages the canceling of advanced monthly payment of profit tax, leaving more cash for business, improving the liquidity of a company, reducing business barriers and simplifying the payment of tax liabilities procedure...