Montenegro’s Cabinet session

    The Government of Montenegro, at today’s session, adopted the Analysis of tax policy implemenation for 2015. The goal of the analysis is that, through contents of tax and customs regulations and collection of taxes, contributions and other public revenues, observe effects of tax policy implementation in the past year and its impact on the economy and the budget, as well as the degree of compliance with tax and customs legislation with the EU acquis and propose appropriate measures for the improvement of this policy in the future. Tax policy in 2015 was predominantly focused on further improvement of business conditions and development of entrepreneurship, attracting investments, elimination of administrative barriers and generating revenue to finance public functions. To this particularly contributed the improvement of legal solutions, consistency and competitiveness of basic tax rates, tax levy abolition, deductions and exemptions abolition.

    The Government adopted an Action plan for combating shadow economy for 2016. In the discussion it was emphasised that the fight against the shadow economy, with fiscal consolidation measures, in the previous period had notable effect on the revenue realisation and, thereby, on improving the fiscal parameters. By reviewing the overall situation, the Government concluded that in period 2013-2015 the planned measures are implemented in accordance with the established schedule, and confirmed their objectives and contributed to a significant reduction of the shadow economy. However, despite all the implemented activities, in some business segments, the presence of the shadow economy is still evident. With the plan for the current year, special emphasis is focused on further improvement of the legislation in order to reduce the scope for tax evasion, which is one of the priorities of tax policy that Government established in the long term. Strengthening of the fiscal discipline through stricter penalties, as well as raising public awareness of the negative consequences of illegal business through education and public campaigns will continue to be primary goal, which is emphasised through the measures defined by the Action Plan.

    In accordance with the new Law on public sector salaries, the Government adopted the Decision on coefficient value accounting for public sector employees for the fiscal year 2016. The calculated coefficient value will amount to EUR 90 for all public sector employees.

    The government adopted a Plan of regular and investment maintenance, reconstruction and construction of state roads in 2016 in the worth of EUR 44.1 million. In the current budget are planned funds in the amount of EUR 9.70 million for regular maintenance and protection of state roads and Service for help and information on public roads, while the capital budget allocated EUR 34.4 million for maintenance, reconstruction and construction of state roads.
    Plan for the preparation of the tourist season in 2016 is also adopted, which aims, through closer cooperation between the institutions at the state and local level, as well as cooperation with tourist entrepreneurs, to ensure quality preconditions and achieve better results and minimize the shortcomings of the previous seasons. Planned activities are related to the improvement of road infrastructure, accessibility, ensuring regular electricity and water supply, improvement of the beach offers, diversification of the tourism product, as well as the promotional activities of the National Tourism Organization and local tourism organizations.

    In order to achieve more balanced growth and development of local government and the region, based on competitiveness, innovation and employment and reduction of regional disparities, the Government adopted an Action plan for implementation of the regional development strategy of Montenegro 2014-2020 for 2016. The plan integrated activities of local government and state institutions and authorities involved in the creation and implementation of the Regional Development Policy, and for each project is given funding structure.

    Source: Government of Montenegro