At the Fourth Session of the Second Regular Session of the National Assembly of the Republic of Serbia in 2020, the National Assembly of the Republic of Serbia adopted The Law on Amendments of the Tax procedure and Tax Administration Law which is published in the "Official Gazette of the Republic of Serbia", No. 144/2020 of November 27, 2020, and enters into force on the eighth day from the day of its publication on December 5, 2020, with certain provisions of the Law on amendments to be applied later.

The most important changes of the Law:

Institutionalization of open-end investment funds, as well as alternative investment funds without the characteristics of legal entities as taxpayers, and harmonizes the provisions of the Tax Procedure and Tax Administration Law (and other tax regulations) with the provisions of the law governing their introduction into the tax system of the Republic of Serbia is done.

In order to facilitate communication between taxpayers and the Tax Administration and more efficient action of the tax authority on taxpayers' requests, it is possible for taxpayers to submit requests regarding the exercise of rights from the tax relationship prescribed by Tax Procedure and Tax Administration Law electronically through the Tax Administration portal.

If the tax act is delivered by sending a registered shipment, the tax act is considered delivered on the day of delivery, and if delivery was not possible, it will be repeated by sending the tax act by registered shipment, and the tax act is considered delivered on the 15th day from the day of submitting the tax act to the post office, regardless of whether it was possible to deliver it to the taxpayer.

Also, it is determined that request for refund of overpaid or incorrectly paid taxes, i.e. ancillary taxes, as well as for other types of refund, i.e. for settlement of due liabilities on another basis by rebooking taxes can be submitted in electronic form through the Tax Administration portal or in writing – directly by post.

Delivery of tax administrative act to the Fund is done to the address of the registered office of the fund management company stated in the prescribed register, i.e. to a special address for receiving mail registered with the Business Registers Agency and the tax act is considered delivered when delivered to the responsible person of the fund management company, the proxy, i.e. tax representative of the fund management company, as well as the employee of the fund management company.

The Tax Procedure and Tax Administration Law applies to the original public revenues of local self-government units that these units determine, collect and control in public law relationship, as well as to secondary taxes on these bases, including original public revenues that local self-government units determine, collect and control in procedures in which they enact tax acts, tax administrative acts, as well as other acts in administrative procedure.

It is not necessary for the individual to whom the tax act issued by the competent authority of the local self-government unit is delivered in electronic form via the Unique Electronic Mailbox to agree in advance with that method of delivery.

The provision regarding the temporary confiscation of TIN in the tax procedure is regulated. It is prescribed that the Tax Administration will assign TIN:

  1. if due and outstanding obligations on the basis of public revenues are up to 100,000 dinars and if these obligations are settled within eight days from the day of submitting the request for the assignment of TIN, ie within that period an irrevocable bank guarantee or a bill of exchange endorsed by a commercial bank is provided, or
  2. if due and outstanding obligations on the basis of public revenues have arisen in connection with the performance of activities, obligations of economic entities that have been deleted from the prescribed registers by a final decision of the competent authority in the bankruptcy procedure.

The Business Registers Agency may not register the acquisition of shares or stocks in business entities, ie the establishment of new business entities, where legal entity or entrepreneur over whom the measure referred to in Article 29, paragraph 9 of the Tax Procedure and Tax Administration Law has been established.

Registration of taxpayers, i.e. the duty to obtain tax identification number (TIN), is extended to flat-rate entrepreneurs, farmers' entrepreneurs, and other types of entrepreneurs defined by the provisions of the Law on Personal Income Tax.

The tax liability may be settled by giving instead of payment, ie by replacing the fulfillment, when the tax liability exceeds 50,000,000 dinars, in the manner and under the conditions determined by the Government decision, and only in cases when there is an interest of the Republic of Serbia in acquiring the subject property, and the day of settling the tax liability by giving instead of paying, ie replacing the fulfillment, is considered the day of verification of the agreement implementing the act of the Government on the transfer of property to the ownership of the Republic.

Deferral of payment of due tax, ie overdue tax liabilities is approved in the manner and under the conditions that are determined by the Government.

Off-balance sheet tax accounting keeps unpaid tax liabilities of taxpayers over whom the bankruptcy proceedings were terminated through bankruptcy in accordance with the law governing bankruptcy proceedings, overpayments of taxpayers for which the statute of limitations has expired in accordance with this law and overpayments of taxpayers, which, in accordance with other regulations, have been deleted from the prescribed register, by the purchase of a taxpayer in bankruptcy proceedings or after the bankruptcy has ended.

It is specified misdemeanor penalties in accordance with the provisions prescribed by this law.

It is prescribed a new criminal offense "Tax fraud in connection with value added tax" (instead of the previous "Unfounded disclosure of the amount for tax refund and tax credit").

The amendment of the criminal offense from Article 173a of the Tax Procedure and Tax Administration Law as an act of execution, in addition to unfounded disclosure of the amount for tax refund and tax credit, also includes the act of committing the criminal act of Tax Evasion, but only for VAT and where the objective condition of incrimination would be determined for a period of 12 months and not for the tax period for which the VAT liability is determined.

  • A fine and imprisonment of one to five years are envisaged for a person who submits one or more VAT returns of incorrect content or claims the right to an unjustified VAT refund or tax credit in the previous 12 months, either for themselves or for another person, and the amount of refund or tax credit exceeds one million dinars.
  • A prison sentence of one to five years and a fine are prescribed for a person who fails to submits one or more VAT returns, or submits false returns, or otherwise avoids the payment of value added tax, either for themselves or for another person, in order to avoid one or more VAT payments in the previous 12 months, and the amount of tax avoided exceeds one million dinars.
  • Also, if the amount of tax avoided exceeds five million dinars, the perpetrator will be fined and sentenced to two to eight years in prison, and if that amount exceeds fifteen million dinars, a fine of three to ten years and a fine is envisaged.

It is envisaged that for natural persons, entrepreneurs and responsible persons in the legal entity - taxpayer who has been convicted of a criminal offense, a security measure of prohibition to perform vocations, activities and duties from one to five years will be imposed.