Unapređenje performansi malih i srednjih preduzeća u Srbiji reformom sistema oporezivanja
Improving the performance of small and medium enterprises in Serbia by reforming the taxation system

Author(s): Saša Ranđelović, Aleksandar Đorđević
Subject(s): Economy, National Economy, Business Economy / Management, EU-Approach / EU-Accession / EU-Development, Public Finances, Fiscal Politics / Budgeting
Published by: Evropski Pokret u Srbiji
Keywords: small and medium enterprises; taxation; economic growth
Summary/Abstract: The competitiveness and growth of the small and medium-sized enterprises (SME) sector is determined by a large number of factors, among which are the level of the tax burden, and the simplicity and transparency of tax regulations and procedures. Although the taxation system is only one of the determinants of the growth of the SME sector, the public in Serbia often states that the unfavorable taxation system of small and medium-sized enterprises is one of the key barriers to their growth and development. In this paper, based on empirical data from the company's financial reports for 2010, the level and structure of the tax burden by company size and by tax forms was analyzed. It has been estimated that small and medium-sized enterprises in Serbia are indeed exposed to a higher tax burden compared to large enterprises, but that the difference is relatively small. It was also estimated that SMEs are to a certain extent exposed to a higher tax burden in the field of local taxes and duties, as well as in labor taxation (more precisely, social security contributions). In this sense, the reform of the taxation system should include: i) the reduction and/or abolition of numerous local fiscal duties, while at the same time expanding the basis for the calculation of property tax and the introduction of local profit tax, so that the total public revenues remain unchanged, ii) the reduction of social security contributions with an increase in consumption tax, which would compensate for the decrease in income based on the reduction of contributions. It was concluded that the reform of the taxation system can contribute to the creation of more favorable conditions for the development of SMEs, but that it is also necessary to implement policies aimed at removing other barriers to their growth, the relative importance of which is greater.

• Details
• Contents