Over 10 programs for faster development and legal start-up of small businesses

The "Start Legally 2020" Conference on Fostering Entrepreneurship, organized by the Government of Serbia and NALED, with the support of the "Public Finance Reform - Agenda 2030" project by the German Development Cooperation, implemented by GIZ, was held today at the Palace of Serbia.

In the last five years, more than 53,000 companies and entrepreneurial businesses have been established in Serbia and last year ended with 390,767 active businesses, making it the 17th country in Europe in this area. More than 10 state incentive programs and local support measures are available to new businesses, and endorsing entrepreneurship would give further tax relief, reduce red tape and the shadow economy.

Prime Minister Ana Brnabic urged anyone with a good business idea to get into business and take advantage of some of the programs offered.

- Supporting entrepreneurship is one of the key elements for creating a healthy, strong, dynamic economy. That is why today we have presented what is available to all entrepreneurs, new businesses, with a clear message that the state is on their side and that we will always support them - Brnabic said.

The Prime Minister reminded that her priority is to stimulate youth employment and invest in science, innovation, research and development and the digital economy, all with the aim of faster economic growth and better opportunities for all citizens of Serbia. She added that the entrepreneurs' need for favorable means for business development is reflected in the reimbursement program for 65-75% of taxes and contributions for newly employed persons, being that since 2016, when this measure started, it was used by a total of 185,000 employers, or almost a half of the economy and that the total value of the benefits is estimated at more than 19 billion dinars.

At the meeting, it was pointed out that during 2019, two major shifts were made in encouraging entrepreneurship, introducing a whole new approach in this area - the automation of flat-rate taxation and the “Start Legally” tax exemption program for new businesses.

NALED Board member and Gorenje Group Executive Vice President Stanka Pejanovic says these changes are the result of a collaboration between the Government and NALED and will mean a lot to the business predictability.

- For the existing 117,000 flat-rate entrepreneurs and all the new ones, the automation of flat-rate taxation will mean dramatically less bureaucracy. All the work will be done electronically, from calculating the amount of taxes, according to fair and objective criteria, to obtaining decisions, and the next step is to consolidate the payments into one account - Pejanovic said.

German Ambassador to Belgrade Thomas Schieb says his country's government has supported projects aimed at reducing unfair competition and introducing tax exemptions for new businesses.

- Germany supports Serbia in public administration reforms, which enable accession to the European Union and, more importantly, improve citizens' lives. The entrepreneurial spirit grows when the state sees itself as an entrepreneurs' partner. "Start legally" is a good example of this - Shieb emphasized.

The "Start Legally" program is a major innovation because it exempts new businesses from taxes and contributions for one year, as well as redundant bureaucracy because they have no pre-financing obligations and are not waiting for a refund. Thanks to this program, 780 companies and stores have been opened with almost 850 employees.

The measure was expanded by the Government of the Republic of Serbia this year with new incentives such as tax exemptions for innovative new businesses, returnees to Serbia and new employment of qualified persons.

The figures on the state of entrepreneurship in Serbia also show that when three entrepreneurs open a store, two close a business, and there is a significant number of those who are starting out in informal flows. According to NALED's estimates, they make up 17%, or about 66,500, which is why it is necessary to work on further reducing the tax burden on wages, which at least two thirds of businessmen see as the biggest problem in business and the cause of fleeing into the gray zone.

The high demand for incentive funds also indicates the need for measures such as "Start Legally" to be expanded in terms of the duration and categories that can use them, as well as to make incentives easier, as collateral or rigorous award criteria are often an unmanageable barrier for entrepreneurs, especially for women.

The regulation of new forms of employment, further optimization of administrative procedures, as well as facilitating access to new sources of financing through microfinance and crowdfunding are also the necessary measures.

Local Government Competition - Entrepreneurship Champions 2020

The conference launched a competition for the most entrepreneurial local self-government - "Entrepreneurship Champions 2020", organized by NALED and the Public Policy Secretariat of the Republic of Serbia, sponsored by the Government and supported by the German Development Cooperation.

The aim of the competition is to encourage local self-governments to become actively involved in stimulating entrepreneurship in their communities through the promotion of national and local support programs, as well as to identify and highlight examples of best practice in Serbia, that is, to support the further implementation of those incentive measures that produce the best results. .

The competition is one of the activities of the National Program for Countering Shadow Economy in order to promote responsible entrepreneurship, and the ranking list of local self-governments will be published on www.uzmiracun.rs, a national website dedicated to the countering shadow economy, on a monthly basis.

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