Serbia, Is the economy ready for the reform

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From January 1st, electronic invoices will be mandatory for all businessmen in the VAT system – the benefit is huge, everything is free and transparent, and according to Finance Minister Sinisa Malog, the economy has been waiting for this for decades. Business people say that the idea is undoubtedly good, but that in practice it has shown numerous shortcomings that harm businessmen and entrepreneurs. They say, if the shortcomings are not corrected – the reform will result in more gray economy.

Almost imperceptibly, during the crisis period, a major reform move was implemented, the Minister of Finance said about the introduction of electronic invoices and fiscalization. The benefits, as he emphasized, are enormous.

“It is much more useful for the employer to know what he bought and what he sold, for everything he does in the business of legal entities. For the storage of e-invoices, we keep up with digitization, the costs are of course lower. For the economy, the most important thing is that by matching incoming and outgoing invoices, we will be able to refund VAT within 24 or 48 hours”, said Siniša Mali.

The first e-invoice officially went through the system in April this year, and the minister reminded that from January 1, 2023, everyone who is in the VAT system will be obliged to use the system of electronic invoices.

“This is what our economy is looking for, such as the introduction of e-fiscalization and e-invoices, so that we can better and more successfully fight against the gray economy”, he says.

Businessmen agree that digitization in this area is an ambitious and useful plan, but only if it is not introduced before extensive testing in practice and a longer preparation period.

While large companies, which have both production and trade, and issue tens of thousands of invoices for N1, say that they are still feeling the pulse of the e-invoice system, entrepreneurs warn that both e-fiscalization and e-invoices harm their business.

First of all, e-fiscalization has become an additional cost and unlike the e-invoice system – it is not free.

“The second problem is that the new system has no solution when the device (fiscal cash register) is broken. So when your device is broken, you can’t work and there is no legal deadline in which the supplier has to fix it. So when you don’t have the right device, you can’t work and earn the money you need. The systems are not connected, which is a disaster. If you work with the public sector, you issue a fiscal invoice, then wait for a statement from the public sector user, then with that statement you cancel the invoice and issue an e-invoice. That cannot be called modernization”, Milena Amon from the Association “Protector of Entrepreneurs and Businessmen of Serbia” told N1.

The representative of the association states that due to numerous problems and higher costs, the process of e-fiscalization is not an instrument for reducing the gray economy. On the contrary, as he says, many decide to go to work unregistered or according to the model offered to freelancers in the field of education, design, programming – for which they were asked to be exempted from fiscalization, N1 writes.