Unified Rulebook on Value Added Tax

Author: Attorney-at-Law Todorović A. Aleksandra, the Law Firm “VUK Tax Attorneys”

Date: 26th April 2021

The Ministry of Finance passed the Rulebook on Value Added Tax (hereinafter: the “VAT Rulebook”), which was published in the “Official Gazette of RS” no. 37/21 of 14th April 2021. The VAT Rulebook enters into force on eighth day from the day of its publication, i.e. on 22nd April 2021, and it begins to apply as of 1st July 2021.

This unified Rulebook finally, 17 years after the Law on Value Added Tax (hereinafter: the "VAT Law") started to apply, as a single legal act regulates and elaborates matters for implementation of the VAT Law, and it also replaces all, i.e. 27 current individual rulebooks in the field of VAT, that will cease to be valid on the day when the VAT Rulebook will start to apply. The existence of that many individual rulebooks, which were amended multiple times since their issuance, has made it more difficult for taxpayers to interpret and effectively comply with their VAT obligations. Therefore, it can be expected that the mere fact of issuing single VAT Rulebook will per se contribute to improvement of tax practices in the Republic of Serbia in the field of VAT.

In addition to unifying all previous VAT rulebooks into one legal regulation, this single VAT Rulebook brings certain novelties, in terms of terminological adjustments, clarifications, then by incorporating opinions given in certain rulings of the Ministry of Finance, as well as by changing certain rules that were applicable until now. Real effects of solutions from the new VAT Rulebook, will be best shown in the future by analysing specific cases to which they should be applied.

On the other hand, even after unified VAT Rulebook will start to apply, three (3) Decrees of the Government of the Republic of Serbia passed on the basis of the VAT Law will remain in force, which altogether with the VAT Law and the VAT Rulebook will constitute entire regulations on VAT in the Republic of Serbia, as follows:

  • Decree on Amount of Expenditure (sludge, shredding, breakdown and breakage) on which VAT is not Payable;
  • Decree on Criteria for Determination of Predominant Export of Goods in Terms of the VAT Law;
  • Decree on Implementation of the VAT Law at the Territory of the Autonomous Province of Kosovo and Metohija During Validity of UN Security Council Resolution 1244.

Finally, we note that transitional provisions contained in the Article 280 of the VAT Rulebook define that, if for the supply of goods or services which is effectuated as of 1st July 2021, the fee or part of the fee is collected or paid until 30th June 2021, the regulations in force on 30th June 2021 will remain applicable to such supply of goods or services.