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V
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I. INTRODUCTORY PROVISIONS
A
rti cle 1 T
his L aw sha ll in tr od uce va lu e a d de d tax (h er ein afte r: V A T) in th e R
epu bli c o f Ser bia (h ere in after : th e Rep ub lic) . T
he VA T is a general consumption tax which shall be assessed and pa
id on the s u pp ly of goods an d services in all stages of p ro ducti on and s
u pp ly o f goods and services, as well as on import o f go od s, u nless oth
erwise deter min ed b y this L aw. A
rti cle 2 T
he rev en ue fr om the VA T s h all be lo n g t o t h e b udg et o f t h e Rep ublic. I
I Subj ect of tax atio n A
rti cle 3 T
he follow ing sh all be l iab le for V A T: 1) De
liv er y of go ods and re nde rin g of s e rv ice s (hereinafter: s u pp ly of go
ods an d servi ces ) carried out by a taxpayer in the Republic, f o r a co
nsid era tio n a nd in th e co urs e of pe rfo rm in g ac tiv iti es; 2) Im
port o f g ood s i n to the Rep ub lic. 1

Supply of goods and services
A
rti cle 4 Ac
cord in g to this Law, s u p ply of goods shall b e transfer of rights o f dis
posal ov er tangible goods (hereinafter: goods), to a person who may have pr
oprie ta ry rig hts , u n le ss o th er wise prov ided fo r b y th is L aw . Go
ods s h all a ls o inc lu d e w ater , elec tr icit y, g as a nd hea tin g e ner gy. Sup
ply of goo ds, acco rd in g t o this L aw, s h all a lso includ e: 1. T
ran sfer of the right of disposal over goods, for a consideration, on t
h e basis of regulations of a state b ody, body of terri torial autonomy or
loc al self -gover nm en t; 2. De
liv er y of goods u nd er a leasing co ntra ct, in accordance w ith the l
a w, o r u nder a sales contract with deferred payment whereby right of dis
posal is transferred not later th an at t he time of th e payment of the l
a st in sta llm ent; 3. De
liv er y of go ods b y th e o wner t o a com mission ag ent and by a co
mmis sio n a gen t to th e rec ip ien t; 4. De
liv er y of go ods u nd er a c ontr act ac co rd in g t o w hich s a le s co
mmis sio n is p aid ; 5. De
liv er y of go ods b y th e o wner t o the co nsig n ee an d b y th e co nsig ne e t
o t h e r ecipien t of the go ods; 6. De
liv er y of go ods p ro duce d or ma nuf actur ed upo n th e ord er of t h e or
der in g par ty, o ut of th e m ater ia ls o f t h e sup pli er, if it is n ot only de
liv er y of acc essor ies o r oth er s ec ond ary ma te ria ls ; 7. Fi
rs t tr an sfe r of t it le over n ew ly es tab lish ed build in g s tru ctu res o r eco
nom ic all y d iv is ib le un its w ithin th ese s tr u ctu res ( h er ein afte r: s
tr u ctu res ); 8. E
xch an ge of g ood s fo r o th er g o od s o r s er vic es . Sup
ply of goo ds f or a co nside rati on s h all als o i n clu de: 1. Use
of goo ds r epr esen ting a par t o f bu sin es s a sse ts o f t h e tax pay er fo
r p er so n al n eed s o f th e fou nder , em plo ye es o r oth er p er so n s; 2. An
y o th er s u pp ly of g ood s fr ee of cha rge ; 2

3. E
xpe nditur e ( ull age , w asta g e, de fect and br eak ag e) in the am ou nt ex
ceed in g t h e a m ou nt d ete rm ined by t h e reg ulati on pa sse d by th e Go
ver nm en t o f t h e Rep ublic of Ser bia . Use
of goods, i.e. an y supply of goods r ef erred to in paragraph 4 of t
h is Article shall be considered s up ply of g oo ds for a consideration provided t
h at the VAT computed f o r such goods or the ir components on purchase ma
y be ded ucted f ully or pro po rti onall y. If
alo ng with delivery of goods, secondary delivery of goods or re
nde rin g of services is performed, it shall be deemed that onl y one d eliv ery of
g o od s h as b een pe rfo rm ed . In
case of successive d eli ver y of the same g o od s where the first de
liv er er transfers right of disposal to the las t recipient of go ods, every s
u cce ssiv e deli ver y o f g oo ds s h all b e c onsi der ed a sep arate delive ry. T
he Minister of Finance ( h er ein afte r: the Minister) shall spe cify what i
s considered to be a n ew ly e sta b lis hed building structure referred to in pa
rag rap h 3 item 7 of this Article, and what is considered to be use of goods re
pre sen ting a part of the b usiness a ss ets of the taxpayer, as w ell as any s
u pp ly fr ee of ch arge ref erred to in para gra ph 4 o f th is A rticle. A
rti cle 5 Ac
cord in g to th is Law, s u p ply of s er vic es shall be understood to i
n clu de all activities and s tep s taken in the co urse of the performance o f activiti
es, which do not r ep res en t supply of goods r ef erred to in Article 4 of t
h is L aw . Sup
ply of se rvice s s h all a ls o inc lu d e a f ailu re t o ac t an d p as siv en ess . Ac
cord in g t o t h is L aw , s u p ply of s er vic es s h all als o in clu de: 1. T
ran sfer an d as sig nme nt o f c opy rig hts, paten ts, l ice nses , t r a de ma rks, as
w ell a s oth er i n tell ectu al p ro p er ty rig hts ; 2. R
end erin g o f s er vices f or a co nside rati on on the ba sis of r eg ula tio ns of
s tate bo dies, bod ie s of ter rito rial auton om y or lo cal s e lf – go
ver nm en t; 3

3. De
liv er y of go ods p ro duce d or ma nuf actur ed on t h e ord er of the or
der in g par ty, o ut of th e m ater ia l o f t h e ord er in g p ar ty ; 4. E
xch an ge of ser vic es f o r goo ds o r s er vices; 5. De
liv er y of fo od an d d rink to be con su m ed o n th e sp ot; 6. T
ran sfer o f title ove r r eal e state; 7. Ass
ig n m en t o f o th er s h ar es or r ig h ts . Sup
ply of se rvice s f or a con sid er ation s h all a lso be: 1. Use
of good s representing part of the business assets of a t a xp ayer fo
r p er so n al n eed s o f th e fou nder , em plo ye es a nd o th er per so n s; 2. R
end erin g of services by a taxpayer free of charge and fo r pe
rs o na l n ee ds of the fo und er , e m plo yees an d o th er p er so ns. Use
of goods r e fe rre d to in p ar ag rap h 4 Item 1 of this Ar ticle shall be s
u pp ly of services f o r a consideration p ro vid ed that the VA T calculated for t
h ese goo ds o n p urch ase may be ded ucted f u lly or p ro p or tion ally. If
along w ith the ser vic es , secondary de liv er y of s er vic es or go ods is pe
rfo rm ed , i t sh all b e dee me d th at on ly on e ser vice has b een pr ovid ed. T
he Minister shall specify w hat is considered to b e the use of g o od s re
pre sen ting a part of the business a ss ets of the taxpayer for the p er so n al ne
ed s o f the founder, employees and other persons, and what is c on side red t
o be rendering o f services by a taxpayer free of charge and f o r the personal ne
ed s o f the founder, employees and other persons referred to in p ara gra ph 4
of t h is Ar ticle . A
rti cle 6 Ac
cord in g t o t h is L aw , s u p ply of go ods an d s er vic es s h all no t i
n clu de: 1. T
ran sfer o f w ho le o r p ar t o f t h e pro pe rty , fo r o r f re e of c har ge, or as eq
uity, i f the acq uire r is alr eady a ta x pa yer or be co mes a tax pay er b y s
u ch t r an sfe r, an d co ntin ues to per fo rm the ac tiv ity; 2. T
ran sfer o f pro pr ietar y righ ts o ve r u se d v ehicles o r v es se ls if t h e t
r an sfe ro r i s n ot a t a xp ayer ac co rd in g t o t h is L aw ; 4

3. Giv
in g b usines s samples free o f charge in usual quantities for that pu
rp o se to buye rs o r f utu re buy ers; 4. Giv
in g g if ts of low v alu e, i f o cca sion ally giv en to diffe ren t p er so n s. In
case of tr an sfe r of whole o r part of the property referred t o in pa
rag rap h 1 item 1 o f this Article, the tr an sfe re e shall replace the t
r an sfe ro r. T
he Minister shall specify w hat is considered to b e the usual quantity of
bu sine ss samples and a gift of low value referred to i n paragraph 1, items 3
and 4 of this A rticle. Import of goods
A
rti cle 7 T
he im port o f g ood s s h all b e an y e ntr y of go ods i n to th e cu sto ms t
e rr itory of t h e Rep ub lic. III TAXPAYER AND TAX DEBTORS
Taxpayer
A
rti cle 8 A
tax paye r (h er ein af te r: taxpayer) shall be a person who i
n dep enden tly and in the c ou rs e of his/her activity p er fo rm s a supply of go
ods o r se rvice s, or imp orts g ood s.
T
he a cti vit y referred to in paragraph 1 of this Article s h all b e an y pe
rma nen t activity of a manufacturer, salesman o r s ervice provider for t
h e purpose of gaining in co me, including the activities su ch as: ex
plo it atio n of natural resources, agriculture, fo rest ry a n d independent activiti
es. A
taxpayer sh all also b e considered to perform ac tiv ity when pe
rfo rm in g ac tiv ity with in the bu sin es s u nit . A
taxpayer shall be a person on behalf an d for the account o f wh
om s er vic es a re re nde red , o r g oo ds ar e d eliv ered o r im ported . 5

A
taxpayer s h all be a person w ho renders s e rv ice s or d eli vers go
ods, on h is o wn be half and f o r th e ac co unt of ano ther pe rs o n. A
rti cle 9 Ac
cord in g to this law, the Republic an d its bodies, bodies of t
e rr itorial autonomy an d local s e lf -g ov ern men t, as w ell as leg al entities l
e ga lly foun ded for the purpose of p er for ming gov ern men t activities s
h all n o t b e co nsid ered t a x pa yers if t h ey pe rfo rm t h e su p ply of g o od s a nd s
er vic es in th e co urs e o f go ver nm en t a cti vit ies o r for the pu rp o se o f pe
rfo rm in g g ov ern men t activiti es. T
he Republic, bodies, and legal persons r ef er red to in paragraph 1 of
this Article s h all be considered tax pay ers if they p er fo rm supply of go
ods and services taxable in accordance with this law outside their go
ver nm en t activities, i.e. ou tside the activities o f the government ad
min is tr a tio n th at a re ta x ab le un der the pr ovisi ons o f th is L aw .
Tax
De btor Article 10
Ac
cord in g t o t h is L aw , t a x d ebto r sha ll be: 1. T
ax pay er re fer red t o i n A rticle 8 an d A rti cle 9 , p ar ag rap h 2 her eof ; 2. T
ax representative appointed by a foreign person without a head of
fice or a permanent organizational unit in the Republic, and wh o pe
rfo rm s s u p ply of go ods an d s er vic es in th e Rep ublic; 3. R
ecipien t of goods a nd services, if th e foreign person re fer red to i
n I te m 2 o f th is p ar agr aph d o es n o t ap poin t a ta x r epr esen tati ve; 4. Per
so n who states the V A T in an invoice o r other document s
er vin g as the invoice ( h er ein afte r: the invoice), if no t obliged to calcu
late and p ay the V AT a ccording to this L aw ; 5. Per
so n w ho i m po rts g o od s. If th
e tax debtor referred to in p aragraph 1 Item 2 and 3 o f this Article i
s a tax pay er at th e same tim e, he/she s h all be o blig ed to fu lf il l the ob
ligatio ns p rescr ib ed by th is law , ex cept to is su e an inv oice. 6

IV.
P LA CE AND TI ME O F SU PPL Y O F G OODS AN D SER VIC ES AND
TAX POINT
P
la ce of supply of g o ods Article 11
T
he pla ce of s u pp ly of g ood s s h all b e the plac e: 1. wh
ere the goods are at the moment of dis patch or transport to th e re
cip ie nt o r, at the recipient's order to a third party, if th e go ods a re dis
patch ed or tra nsp ort ed by the sup pli er, recipient or a third party, at t
h eir or der ; 2. of
building or inst alli ng of goods, if the goods a re built or in sta lled by t
h e su p plier o r a t h ird p ar ty, at th e req ues t of th e su p plier ; 3. wh
ere the goods are at the m om en t of delivery, if delivery is b ein g car
ried ou t witho ut d ispatch i .e . tr an sp o rtation ; 4. wh
ere wa te r, ele ctricity, ga s, an d h eati ng en ergy ar e r eceiv ed. In
ca se of supply of goods in the course of commission o r co
nsig n m en t a cti vit ie s, the place of supply o f g oods carried out by a co
mmis sio n a ge nt or a consignee shall be determined in accordance with pa
rag rap h 1 of this Article for delivery to the commission agent or the co
nsig n ee . Pl
ace of s upply of s er vic es Article 12
T
he p lace of supply of services shall be the place w he re th e s e rv ice pr
ovid er per fo rms h is/he r a cti vit y. If
supply of s er vices is carried o u t through a b u sin es s unit, the p lace of
s u pp ly o f s er vices sha ll be th e lo catio n of t h e busine ss u n it. As
an exception to p ar ag rap hs 1 and 2 o f this Article, the p la ce of s
u pp ly of ser vic es s h all b e: 7

1.
Place w her e real estate is located, f o r the supply of services w hich are in dir
ect relation to r ea l estate, including a cti vit ies performed by a n agent and ev
alu ation of real est ate , as well as planning, preparations, a n d performance an
d sup erv ision o f c onst ru cti on w or ks; 2.
Place where transportation takes place, and if transportation takes place bo
th on t he territory of the Republic of Serbia and on the territor y of anot her co
untr y (hereinafter: international transport), the pr ovisi ons o f this Law s
h all be applied only to the p art of the transportation that takes p la ce in the R
epu bli c; 3.
Place where the s e rvice s have actually been r en der ed, in the following cases
: 1) Ser
vic es in the field o f culture, arts, science, s p or t, education and s
cien ce, entertainment and similar services, inc lu ding the s ervices of or
gan izin g enter tainment p rog ram s, as w ell as r elated s er vices; 2) Au
xil iar y transport se rvice s, such as loadi ng, unloading, reloa din g an
d si milar se rvice s; 3) Ser
vic es o f th e ap prais al of m ov ab le pr oper ty; 4) Wo
rk s p er for med o n m ovab le pro per ty; 4.
Place where the recipient o f s er vices performs activity or has a bu sin es s un
it th ro ugh w hich t h e s e rvice i s p er fo rme d, o r t h e h ea d o ffic e o r r e sid enc e of
the re cip ie nt of th e ser vice, f o r th e follow ing se rvice s: 1) R
enting o f m ovab le pro per ty, ex cept m ea ns o f t r a nspo rtati on; 2) T
elec ommun ic ati on s er vic es ; 3) T
ak ing over the responsibility for p ar tial o r full restraint from un
der tak ing ce rta in ac tiv iti es o r exe rcis in g ce rtain rig hts ; 4) Ser
vic es in the fie ld o f com mercia l ad ver tisi ng; 5) T
ran sfer and assignment o f copyrights, patents, lice nses , trademarks an
d si milar in te llec tu al pro per ty rig h ts , a nd m ak ing th es e a vail able; 6) B
ank ing, fin an cia l se rv ic es and insurance services including re- i
n su ran ce, e xcep t re nta l o f saf e dep osit b o xe s; 7) Ser
vic es provided by co nsu ltan ts, engineers, lawyers, a u ditor s, and s
im ilar ser vic es , 8) Da
ta pr oce ssin g and p rov idin g i n fo rm atio n; 9) Sup
ply of per so n nel; 10
) Ser
vices r end ered elec tron ic a ll y , a s w ell as radio an d TV se rvice s; 8

11
) Me
diati ng in the course of rendering se rv ic e s u nde r sub-items 1-10 of t
h is i tem . 5.
Place wh ere go ods ar e d elive red or s e rv ice s ar e ren der ed , if the se a re s
u bj ec t to med iati on n ot in clu ded i n I te m 4 s u b-item 1 1 of t h is pa rag rap h. P
lace of Impor t of Goo ds Article 13
T
he place of i m po rt of goods sha ll be any poin t of entry of goods into t
h e cust om s t e rritor y o f t h e Rep ublic. Time of Supply of Goods
Article 14
T
he day of s u pp ly of g ood s s h all b e: 1. T
he day when dis p atc h or transport of the goods to the recipient o r, at t
h e re que st of the recipient, to a thi rd party, begins, if the g o od s are dis
patch ed or tra nsp ort ed by the p rovi der , recipient, o r a third party, at th
eir ord er ; 2. T
he da y when the recipient takes over the goods from the s u p plier , o r a
th ir d par ty at his r eq uest , i n ca se of bu ildin g or i n stall ing th e go od s; 3. T
he day of transfer o f the right of d ispo sa l over goods to th e re
cip ie nt, i f d eli ver y o f g oo ds d o es n o t inc lu d e dis patch or tra nsp or t; 4. T
he day of re ad ing the amount of received water, elec tr icit y, gas and he
ati ng en ergy p er fo rme d b y th e p rov ider with a v iew t o d eter min in g co
nsu mp tion . 5. T
he day of en tr y o f g oo ds into t h e cust om s t e rritor y o f t h e Rep ublic. In
c ase of commission or consignment activiti es, the time of delivery of
g oo ds by the commission agent or a consignee shall be determi ned in acc
ord anc e w ith paragraph 1 of this Article for the delivery to th e co
mmis sio n a gen t o r co nsig n ee as w ell . Pro
vis io n s of paragraph 1 and 2 of this Article shall a lso apply to pa
rtial deliv er ies . 9

T
he part ia l delivery referred to in p ar ag rap h 3 of this Article shall b e an
y delivery of certain p ar ts of ec on om ic all y measurable d eli very where a s
p ecial fee has b een ag reed u p on . Ti
me of s uppl y of servi ces Article 15
A
se rvice s h all b e co nsid ered r en der ed w he n: 1. In
divid ual r end erin g o f s er vices h as be en co mple te d; 2. L
eg al basis for r en der ing of service h as been terminated- in case of de
liv er ing ti m e-lim ited o r u nlimited s er vic es . If
p er iod ical inv oices a re t o b e is su ed f or d eli very of s e rv ice s, sup ply of
services shall b e completed on th e last day o f the period f o r which the i
n vo ic e is is su ed. Par
tial service shall be considered rendered w hen delivery of tha t part of
the s er vic e has b ee n c omp leted . T
he pa rtial se rvice referred to in paragraph 3 of this Article sha ll b e a s
er vic e where a special fee h as been agree d for certain parts of econom ic all y me
asurab le se rv ice . Tax
point Article 16
T
he tax liabi lity shall begin o n the fir s t day of any of th e following activiti
es: 1. Sup
ply of goo ds a nd se rvice s; 2. C
oll ecti on, if the fee or a part of the fee has b ee n c o llec te d pr ior to t
h e su p ply of g o od s a nd s e rv ice s; 3. On
the day of becoming liable t o customs duties at import of g oo ds, an
d if t h er e is n o such liab ilit y, the t a x liability sha ll begin o n the d ay wh
en bec omin g liab le t o s u ch d uties . 10

V. TAX BASE AND TAX RATE
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Article 17
T
ax base (hereinafter: the base) at s u p ply o f goods and services shall be
the amount of fe e (in cash, goods or services) that has been received or is t
o be received by the taxpayer f o r the goods delivered or services re nde red , i
n clu din g subsidies directly related to the price of s u ch goods or services, no
t in clu din g t h e V AT, un les s o therwis e pr ovid ed by th is L aw . T
he bas e sha ll als o i n clu de: 1.
E xcis e, cust om s d uties an d o th er imp ort d uties, as we ll as o the r p ublic re
ven ues , ex cept V A T; 2.
A ll sec ond ary ex pen ses th at th e tax pay er ch arges a r ecipien t of g o od s a nd s
er vic es . T
he bas e sha ll not in clu de: 1. Dis
cou nts granted to the recipient of goods or services at the tim e o f s
u pp ly of g ood s or s e rv ice s; 2. Am
oun ts cha rge d by the taxpayer on behalf and for the a ccount o f an
oth er person, if th at amount has b ee n transferred to the person on be
half an d for the account of whom the taxpayer has performed the co
llec tio n. If
the fee o r a part o f the fee h as not been s tated in cash, b ut in the fo
rm o f supply of goods and services, the tax base shall be th e m ar ket v alu e of
such g o od s or s er vic es on th e day of delivery of such g o od s or s er vic es , no
t in clu din g t h e V AT. Article 18
T
he base in case of supply of goods and services referred to in Article 4
paragraph 4 and Article 5 paragraph 4 hereof shall b e purchase p ric e, i.e., co
st p rice of s u ch or s im ilar g oo ds an d s er vices a t th e m om ent of su p ply . 11

As to p
aragraph 1 of this Article, the VAT shall not be inclu ded in th e ba
se. If
transportation by bus has be en carried ou t by a person without a he
ad of fice in the Republic, the b ase sha ll be the average transportation fe e fo
r ea ch pa rticu lar t r an sp o rt. T
he m an ner of d eter min in g th e f ee m en tion ed in p ar agr aph 3 of this Ar
ticle s h all b e sp ec if ied b y th e M inis ter . Base at import of goods
Article 19
In
ca se o f im po rt o f g oo ds, th e b as e sha ll b e th e v alu e o f im po rted go
ods d eter min ed b y the cu stom s r eg ulati ons. T
he b as e r e fe rre d to in p ar ag rap h 1 o f th is Ar ticle s h all als o i n clu de t
h e fo llo win g: 1. E
xcis e, cu sto ms d uti es an d o th er i m po rt duties , as w ell a s o th er p u blic re
ven ues , ex cept f o r th e V AT; 2. All
secondary costs incurred until r e ach ing the f irst destination in t he R
epu bli c. T
he fir st d estina tio n, according to paragraph 2 item 2 of this Ar ticle, s
h all be the place indicated in the di sp atc h note or other transport do cu men t, an
d if n ot indicated, the place of th e first transshipment of goods in the R
epu bli c. Article 20
In
case of i m po rt of goods th at have been tem por arily exported by the t
a xp ayer fo r the purpose of refinement, processing, reprocessing and fin
ishin g ( h er ein af ter : r e fin em ent), r ep air o r c on str ucti on, th e b as e s h all b e t
h e fe e that has already been p aid or is to be paid b y th e taxpayer for re
fin em ent, repair or construction, an d if the fee i s not to be pa id , the base s
h all be the in cr eas e in va lu e re su lti ng fro m ref in eme nt, rep air o r co
nstr u ction . 12

As f
or pa rag rap h 1 o f th is A rti cle , th e pro vis io n s o f A rti cle 1 9 pa
rag rap h 2 o f th is Law s h all b e ap pli ed. Change of tax base
Article 21
If
the t a x base f or supply o f goods an d services liab le for t a x ati on has be
en c hanged, the taxpayer who has delivered goods or rendered s e rv ic es, s
h all be obliged to correct th e V A T amount that, on the bas is o f this, re
pre sen ts h is /h er l iab ility, i n ac co rda nce with t h e c han ge. T
he liability under p ar agr aph 1 of this Article shall a lso apply to th e pe
rs o ns r efe rre d to i n A rticle 10 par agr aph 1 i tem s 2 an d 3 h er eo f. If
the base has b een additionally changed due to return of goods or can
cell atio n of the contract, th e taxpayer who has p er fo rm ed supply of go
ods and services may co rre ct the VAT amount o nly if the taxpayer f o r wh
om the supply of g o od s and services has b een performed, amends the de
duc tio n of the input VAT, an d if he/she notifies in writing t h e sup pli er of go
ods an d s er vic es . T
he taxpayer may co rre ct the base f or the amount of the fee tha t has no
t be en collected only on the basis of a court ru lin g o n th e clo sed ba
nkr uptc y proc eedin gs or en fo rced s e ttl em en t. If
the taxpayer, who co rrec te d the base in acc ord anc e with paragraph 4
hereof, receives the f ee or part of th e fee for the de liv er ed goods and s
er vic es for w hich the correction of the b ase is allowed, the taxpayer s h all be
ob liged to asse ss t h e V AT f o r th e rece iv ed amo unt o f t h e fee .
T he correction of the base m ention ed in paragraphs 1-4 of this Ar
ticle shall be performed in the tax period in which the change h as oc
cu rr ed . If
the base for import o f g o od s liable for VAT has c hanged in acc
ord anc e with the customs reg ula tio ns, the provisions of th is Law shall be ap
plied . 13

wYCIB)FIA)D)FIBIgI)CIIx)gCIIB)gYvIB)F)DIYII)gIIIgIBIgIYIj)gI)Ix)gIBCICYIYuWI)YgIx)gIA)DCYCYIYIxIACD)gk
Article 22
If
the fe e fo r su p ply of g o od s a nd s e rv ice s i s s tated in fo reign cu
rre ncy, the me an r ate of th e ce ntr al bank whic h is in eff ect o n t h e d ay of t
h e orig in ati on of tax l iab ilit y s h all b e ap pli ed fo r c onv ersi on of tha t v alu e i
n to dom es tic cu rre ncy. If
the base fo r import of g o od s is stated in foreign currency, the cu
stom s regulations determining the cu stom s value, which are in effect on t
h e day of the or igin ation of tax liability, s h all be applied for co nve rs io n of s
u ch va lu e in to d o me sti c c urr enc y. Tax rate
Article 23
T
he g en eral V AT ra te fo r ta xa ble sup ply o f g oo ds a n d s e rvice s o r i
m po rt of goo ds sha ll be 18 % . T
he special VAT rate of 8 % shall be applied to the f o llo win g supply of
g o od s a nd s e rv ice s, o r i m port o f g ood s: 1) B
rea d, milk, flour, sugar, edible sunflower, maize, rape, soybean and olive
oil, edib le an im al an d v eg etab le fats ; 2) Fre
sh an d f ro ze n fru its an d ve getab le s, me ats an d fis h, an d e ggs; 3) Me
dic in es included in the list o f medicines t o be sold o n prescription an
d made out from t h e funds for health insur anc e, in accordance with t
h e hea lth i n su ran ce re gulation s; 4) Or
thotic and prosthetic means, a s w ell as medical means- products t
h at are su rg ic all y i m pla n te d in th e orga nis m ; 5) Dialysi
s m ater ials; 6)
Fe rti lize rs , pesticides, seed stock, nursery s to ck an d complete fodder mix
tu res f or an im al f ee din g; 7)
T extb ook s a nd teac hin g aids; 8)
D ail y ne wsp ap ers; 9)
M ono grap hs an d s er ial p ublica tio ns; 10
) Fi re wo od; 14

11
) Accommodation in hotels, mo tels , resorts, rec reati on centers a nd cam
ps 12
) U til ity ser vices. 13
) Natural g as delivered to individual p ro d uc ers through th e gas dis
trib utio n n etw ork; T
he Minister shall specify what is considered to be goods a nd s
er vic es ref err ed to in pa rag rap h 2 it em 1 , an d 4 -1 2 o f th is Ar ticle , acc
ord ing to th is Law .
VI. TAX EXEMPTIONS
w)mIBYx)gIYYxIYYmC)IgI)CIIxII)gIBCICY)gII)DC)C))FCD)gCIIB)gYgCICIIjII)gIBuWIxIj)gIIIYCYYvI)IAIYIIk
wYCI)IgIC)gCYI)YgICIg)gIgCI)gIjIYIj)DIAIgI)CIIx)gCIIB)gIgICIY)gI)IxC))DIguW)gIgIBYxk
Article 24
T
he V AT sha ll not be paid fo r: 1. T
ran sp o rtation an d o th er s e rv ice s re la te d to i m po rt of goo ds, if v alu e of
s u ch s e rv ice s i s in clud ed in th e bas e re fer red t o i n A rticle 19 pa
rag rap h 2 h er eo f; 2. Sup
ply of goo ds sen t o r dis patch ed abr oad b y the t a xp ayer o r a t h ird pa
rty u pon th e ord er of t h e tax pay er; 3. Sup
ply of goo ds sen t o r dis patch ed abr oad b y a fo reign r ec ip ien t o r a t
h ird p ar ty upo n t h e o rd er o f th e for eig n re cip ie nt; 4. Sup
ply of goo ds d ispatch ed ab ro ad b y a fo re ig n r ecip ie n t as p erson al l
u gg ag e, p ro vide d th at: 1) T
he goo ds ar e d ispatch ed b ef ore th e e xpir y of th ree calen dar mo
nths u pon d eliv ery of suc h g ood s; 2) T
he to tal valu e o f d eli ver ed goo ds is h ig h er tha n 1 0 0 00 d in ars, i
n clu din g t h e V AT; 5. E
ntr y of go ods i n to th e fr ee zon e, exc ep t th e go od s f o r e nd co
nsu mp tion i n the fr ee zo ne; 6. Pro
vidin g o f t r a nspo rtati on an d o th er s er vic es to th e user s o f t h e free zo
ne dir ec tly related to entr y of g ood s i n to the fre e zo ne; 7. T
he w or ks p er fo rm ed on mo vab le prop erty obta in ed by a f oreig n use r of
the s er vic e in the Rep ub lic or imp orte d f or t h e purpo se of re
fin em ent, re pair or co nstr u ction , an d wh ich i s to be t r an sp o rte d o r 15

dis
patch ed abr oad u p on r ef ine men t, r ep air or co nstr uc tio n b y th e pr
ovid er of t h e se rvice , f oreig n rec ip ien t or a thir d p arty workin g un
der the ir o rde r; 8. T
ran sp o rtation an d o th er s e rv ice s i n d ir ec t r elation w ith t h e exp ort, t
r an sit o r t e m po rar y im por t of g o od s, ex cep t th e ser vices V AT ex
em pte d w itho ut r igh t to t a x d edu ctio n in acc ordan ce w ith th is Law ; 9. In
ter nati on al air tran sp ort o f p ass en ger s, w her eb y th e non -res iden t air co
mpa ny is f ree fr om t a xa tio n o nly und er a r ecipr ocity rule; 10
. De
liv er y of airc raf t, s e rv icin g, r ep air s, ma in ten ance, ch arter an d re
ntin g plan es u se d m ain ly fo r a ch arg e in t h e in te rn atio na l a ir t r a ff ic, as
w ell a s de liv er y, r en ting, r epa ir s a nd m ain te na nce of t h e goo ds used
fo r eq uip p ing s u ch air craft; 11
. Sup
ply of goo ds a nd se rvice s i n ten ded t o m ee t d ir e ct n eed s o f th e airc
raf t r ef err ed to in i tem 1 0 of t h is pa rag rap h; 12
. In
ter nati on al riv er tra nsp or t of p as sen ger s b y sh ip , w he reb y no n- re
side nt co mpan y fo r in te rna tio nal r iver t r an sp o rt b y sh ip is f r ee fro m t
a xa tio n o nly und er rec ip ro cit y ru le; 13
. De
liv er y of s h ip s, s er vicing , r ep air s, m ain ten ance an d r enting s h ips used
ma in ly fo r a c har ge in inter nation al r iv er tr an sp o rt, as w ell a s de
liv er y, r en ting, r epa ir s a nd m ain te na nce of t h e goo ds u se d f or eq
uip pin g s u ch s h ip s; 14
. Sup
ply of goo ds a nd se rvice s u sed t o m ee t d ir e ct n eed s o f th e sh ip s re
fer red t o i n I te m 13 h er eo f; 15
. De
liv er y of go ld to t h e N ation al Ban k o f Ser bia ; 16
. Go
ods an d s er vic es in te nd ed to m eet: 1) of
ficial n eed s o f diplo mati c a nd con su lar r ep res entative of fices, 2) of
ficial n eed s o f in te rn atio na l o rg an iz ati on s, i f tha t is p ro vide d fo
r b y in ter nati on al contr a ct; 3) Per
so n al n eed s o f per man ent staf f o f d ip lom atic and co nsu la r re
pre sen tati ve o ffic es , inc lu d ing m em ber s o f th eir famili es; 4) Per
so n al n eed s o f per mam nen t sta ff of i n ter nati onal or
gan iza tio ns, includ ing m em ber s o f t h eir fa mili es, i f t h at is pr
ovid ed fo r b y in te rna tio nal c ontr act; 17
. Me
dia tin g se rvice s r elated t o t h e sup ply of goo ds a nd se rvice s re
fer red t o i n it em 1- 16 o f th is p ara gra ph. T
ax exemption referred to i n paragraph 1 item 3 of this Article s h all no
t apply to supply of g oods tr an sp o rte d by a foreign recipient o n h is own fo
r the purpose of furnishing or sup plying sports vessels, sports aircraft a nd oth
er m ean s o f t r an sp o rta tio n f or pe rs o na l n ee ds. 16

T
ax ex em pti on re fer red to i n p ar ag rap h 1 item 16 s u b-item s 1 an d 3 he
reo f shall apply on ly under reciprocity r ule and upon co nfir m ation of the Min
ist ry of For eig n Af fair s. Pur
su ant to this A rticle, t h e f oreig n rec ip ien t of g oo ds o r ser vic es s
h all b e: 1. A
per so n w ho is a ta x pa yer and w hose head o ffice i s o utsi de th e R
epu bli c; 2. A
per so n w ho is no t a ta x pa yer and w hose res iden ce or h ead o ffice i s ou
tside t h e Rep ub lic. T
he M in is te r sha ll pre scr ib e th e m ann er and the pr oce dur e o f re
ali zati on o f tax ex em pti on me ntio ne d in pa rag rap h 1 -3 of this A rticle. Tax
ex empti on for the supply wCIIB)gYgCICIIjII)gIBIxIj)gIIIYCYYvI)IAIYII)gYCI)IgICCI)DIg)gCYI)YgICIg)guWIgCI)gIjIYIj)DIAIgI)CIIx)gCIIB)gIgICIY)gI)IxC))DIg)gIgIBYxk
Article 25
T
he V AT sha ll not be paid fo r f in an cial tr an sa cti on s an d cir cula tio n of
ca pital, as f ollow s: 1) T
ran sac tio ns a n d m ed ia tin g activities while dealing with legal t
e nd ers, ex cep t for paper money and coins not used as legal t
e nd er or ha vin g nu mism ati c v alu e; 2) T
ran sac tio ns and mediating activities while dealing w ith shares, i
n ter est in companies and associations, bonds and other s
ec urities, except transactions related to keepi ng and ma
nag em ent of s e cu riti es; 3) C
red it o per ation s, inc lu d ing m ed iati on; 4) Un
der tak ing li abili ties, gu ara nte es an d o th er m ea ns o f s ec urin g pa
ym ent, in clu din g m ediation ; 5) T
ran sac tio ns and mediating while dealing with d ep osits , current an
d gyro accounts, pay me nt orders, as w ell as payment op
era tio ns an d tr an sfer ; 6) Op
era tio ns an d m ed ia tio n when dealing with receivables, ch
ecks, bills and other s imilar securities, except for co llec tin g re
ce iv ab les f o r o th er pe rs o ns. T
he V AT sha ll not be paid fo r sup ply of th e follow ing: 17

1) Ser
vic e of insurance and re-insurance, i n clu din g the a c companying s
er vic es o f an i n su ran ce me dia to r an d a gen t ( rep res en ta tiv e); 2) L
an d (a gricu ltural, co nstr u ction , b uilt o r n ot b uil t) ; 3) St
ru ctu res, except f or supply o f structures r ef err ed to in Article 4 pa
rag rap h 3 it em 7 o f th is L aw ; 4) Ser
vic e of ren ting f la ts a nd b u ild in gs, i f u sed f or h o usi ng pu rp o ses ; 5) Sha
res , securities, p o stal orders, ad minis trati ve fees an d stamps b y t
h eir va lu e in t h e Rep ub lic; 6) Post
al services re nde red by a public co mpa ny, as w ell as de liv er y of t
h e related g o od s; 7) Me
dic al tr ea tm en t in h ealth c ar e fac ili ties in a cco rd an ce with th e re
gulation s o n he alt h ca re, ex cept p ha rma cies a nd p h ar mace utica l i
n sti tu tio ns, including care, board and lod ging f o r patients in such i
n sti tu tio ns; 8) Me
dic al s ervices rendered by doctors, dentists o r o ther persons in acc
ord anc e with t h e reg ulati ons o n hea lth car e; 9) Ser
vic es o f d ental p ro sth eti cs d eli ver ed b y a d ental t e ch nic ia n , a nd t
h e sa m e ser vices d eliv ered b y a den tist; 10
) T
ran sfe r of human organs, tissues, body fluid s and cell, blood and mo
ther's m ilk ; 11
) Renderin
g of so cia l welfare se rv ic e s, child and youth w elf ar e s
er vic es , services of s o cial care institutions, a n d related supply o f go
ods an d servi ces performed by the persons registered for such activiti
es; 12
) Board
and lodging f o r s tudents in student dorm ito ries and similar i
n sti tu tio ns, a s w ell as r ela te d su p ply of g o od s a nd s e rv ice s; 13
) E
duc ati on ser vices (elem entar y, sec ondary and university ed
ucation ), and professional r e -tr ain in g, as well as supply of g oo ds an
d s e rvice s related to these and performed by persons registered fo
r such activities, if these activities ar e carried out in compliance with
the reg ula tio ns d efin in g t h at d o ma in ; 14
) Ser
vices in the field of c ultur e and related supply of go od s and s
er vic es , r en der ed b y no n- pro fit e ntit y re gis ter ed fo r suc h a cti vit y; 15
) Ser
vices in the field of science and related supply of goods and s
er vic es , r en der ed b y no n- pro fit e ntit y re gis ter ed fo r suc h a cti vit y; 16
) Renderin
g of services of religious ch ara cter b y the registered re
lig io u s o rga niz ati ons, an d r ela te d su p ply of g o od s a nd s e rv ice s; 17
) Publ
ic broadcast ing, ex cept the ser vices o f c ommerc ia l natu re. 18
) Ser
vices o f org anizing g amb lin g; 18

19
) Renderin
g o f services such a s spor ts and physical c ultur e to the pe
rs o ns en ga ged in su ch ac tiv iti es an d by no n-p ro fit en tities re
gis ter ed fo r p erf orm in g s u ch activiti es. T
he Minister shall prescribe the m an ner a nd the procedure of gaining rig
ht to tax exemption referred to in paragraph 2 Item 7, 11 , 1 2 , 1 3, 14 , 15 an
d 1 8 o f th is A rticle. Tax
ex empti ons on i mpo rt of go ods Article 26
T
he V AT sha ll not be paid fo r th e imp ort o f t h e fo llo win g go ods: 1. T
he goods the su pp ly of which is VAT-free in a cco rd an ce with Ar
ticle 24 paragraph 1 Item 5, 10, 11 and 13-16, an d A rticle 2 5 pa
rag rap h 1 I te m 1 an d 2 a nd par agr aph 2 i tem 5 a nd 10 he reo f; 2. T
he goods temporarily im porte d and then e x po rted again in th e co
urse of the cu sto ms procedure, as w ell as the go ods undergoing re
fin em ent and fo llow ing the dis posal prin cip le ; 3. T
he goods tempo rar ily imported and the n exported a g ain in an un
alter ed co ndition in the co urs e of th e cu sto ms pr oce dur e; 4. T
he go od s for which refining under customs control has been granted i
n t h e c our se of the cu stom s p ro ced ure; 5. T
ran sit o f g ood s i n t h e c our se of the cu stom s p ro ced ure; 6. T
he goods for w hic h customs storage h as been granted in the course of
the cu stom s p ro ced ure; 7. T
he goods fo r which ex em ptio n from c ust om s duties h as been pr
escr ibe d in accordance with Article 192 p ar ag rap h 1 Item 1-10 and Ar
ticle 193 paragraph 1 Item 6 of the Customs Law ("Official Gazette of
the R epu bli c o f Ser bia ", n o . 7 3/0 3 ). VII. INPUT TAX
Definition
Article 27
T
he input tax shall be th e VAT a mo un t calculated in the previous s
ta g e of supply of g o od s and services, or paid at import of go ods, and which
t
h e tax pay er ma y ded uct from his V A T l iab ilit y. 19

Co
ndit io ns f o r deduc tion of input ta x Article 28
T
he ta xp ayer ma y gain the right to deduction of the input tax if the t
a xp ayer uses or will u se the goods acquired in the Republic or imp orte d , i
n clu din g the a cq uis iti on of eq uipm ent and s tr u ctu res for p er fo rmin g the activity,
or received services, for the following supply of goods a n d s
er vic es : 1) Sup
ply of goo ds a nd se rvice s l iab le fo r V AT; 2) Sup
ply of goods and s e rvice s exempted from VAT in accordance with
Article 24 of this L aw; 3) Sup
ply of good s and services performed abroad, if the right to de
duc tio n of the input ta x would have been a p plied to such supply, ha
d th e su pp ly b een pe rfo rm ed i n the R epu bli c. T
he ta x pa yer sh all be en titl ed to dedu ctio n of t h e in pu t ta x if h avin g: 1) An
invoice for the input ta x am oun t made out by the othe r tax paye r pa
rticip ating i n t h e sup ply, i n ac co rda nce with t h is L aw ; 2) Do
cum ent o n c om pleted im po rt o f g oo ds, s tating the in pu t tax , i. e. cer
tify in g that the recipient or im po rte r has pa id the stated V AT at i
m po rt. In
the tax period in which the co nd ition s from paragraph 1 and 2 of t
h is Article have been met, the tax paye r may deduct the input ta x f r om the VA
T li ab ili ty, as f oll ow s: 1) T
he ca lc ulated an d s tated VA T li ab ili ty fo r sup ply o f g oo ds a n d s
er vic es th at h as alre ady b ee n p erf orm ed or is yet t o b e p er fo rm ed b y an
oth er tax paye r e nga ged i n t h e sup ply; 2) T
he V AT th at has b een p aid at im port o f g oo ds. T
he right to d edu ctio n of the in pu t tax shall be co me effective on th e da
y of m eeti ng t h e con dit io ns f ro m para gra ph 1-3 o f t h is A rticle. T
he tax d eb tor referred to in Article 10 paragraph 1 item 2 a n d 3 of t
h is Law may be entitled to deduction o f the input tax provided th at the t
a xp ayer has paid the VAT for the fee r ec eive d for the goods a n d services in 20

acc
ord anc e with this law, and i f the receiv ed goods and services are used for t
h e su p ply of g o od s a nd s e rv ice s l iab le for V A T. Exce
ptions f rom deduc tion of i nput tax Article 29
T
he taxpayer shall not be e n tit led to deduct the input tax on the basis of
the fo llow ing : 1) Ac
quis itio n, prod uction and import of vehicles, m otor cycles, ve ssels an
d aircraft and s p ar e parts, gas an d supplies for the ir needs, as we ll as
r en tin g, m aintain ing, repairing and other services related to the use of
the se m ea ns of tra nsp or t; 2) R
epr esen tati onal costs of the t a xp ayer . 3) Ac
quis itio n or im port of carpets, electr ic household app lian ces, t
e le vis ion and radio sets, w orks of fine and ap pli ed arts and other de
co rati ve item s f or o ffice pr emis es; 4) Ac
comm od atio n exp enses an d t r a ve l a nd m ea l allow anc es. E
xcep tion ally from paragraph 1 it em 1 of this A rti cle , the taxpayer s
h all b e entitled to deduct the input tax in case o f usi ng th e mean s of t
r an sp o rta tio n a nd othe r m ean s ex clu sive ly fo r: 1) Sup
ply and renting of the s ta te d m ea ns of transportation and other go
ods; 2) T
ran sp o rtation of p asse nge rs and goods, o r drivers tr ain in g for the s
ta te d m ean s o f tr an sp o rtation . wIFI)YgICIg)gIgCI)gC)CYCIC)CICYIgI)CIIxIB)F)gIjIYIj)DIAIgI)CIIx)gCIIB)gI)uWIxC))DIg)gIgIBYxk
Article 30
If
the tax paye r uses delivered o r imported g oo ds for the purposes of i
ts ow n activities, or receives services in or der to carry out supply o f go ods an
d services with or without right to deduction of t h e input tax, the taxpayer ma
y be en titled t o p ro portio na l d ed uction o f th e inp ut tax . T
he p ropo rti ona l part of the input tax corresponds to the part o f th e s
u pp ly of goods and ser vic es with right to d ed uction of the input tax , not i
n clu din g the VAT, within the to tal supply n o t including the VAT (h
ere in after : pe rcen tage of pr opo rtion al d ed ucti on ). 21

Per
centag e of pr oportion al deduction for a tax p er io d shall be de
te rmin ed by putting into proportion sup ply of goo ds and services wi th rig
ht to deduction of in put tax not including V A T and total supply o f goods an
d services not inc lu d ing VAT and p erf orm ed from January 1 of the cu
rre nt ye ar t ill the ex pir y of t h e tax p er io d f or w hic h tax r etur n i s f iled . T
he proportional tax deduction shall b e determined by applying the pe
rcen tage of proportional d ed ucti on to the i n pu t tax amount re duc ed by the am
oun t re fer red t o i n A rticle 29 p ara gra ph 1 h er eo f. T
he Min ist er s h all specify the manner of determining proportional de
duc tio n. Correc
tion of deduct ion o f input tax in case of changed base Article 31
If
the base o f taxable supply o f goods and s e rvice s has been c ha nge d, t
h e taxpayer f o r whom the supply of g ood s and services has been c ar rie d ou
t, shall be obliged to c o rr ect the deduction of the in put tax g ran te d to him
/h er on t h e basi s o f t h is , in acc ord anc e with t h at change. T
he correction of deduction o f the input tax s tated in paragraph 1 of t
h is Ar ticle s h all als o r ef er t o the re cip ie nt of goo ds o r s er vices r efe rre d to i n Ar
ticle 10 p ar ag rap h 1 item 2 and 3 of this L aw. De
duc tio n of th e input ta x referred to in p ar ag rap h 1 o f this Ar ticle s
h all be co rrec te d in c as e of r etu rning the g oo ds, annulling t h e contract, an d on
the basis of court ruling on the closed enforced s ettleme nt, in acc ord anc e with
Article 21 pa rag rap h 3 an d 4 o f t h is L aw . In
case that th e VAT for i m port of goods, d edu cte d as input tax , has be
en increased, r ed uce d, refunded, o r the tax pay er is f r ee from VA T, the t
a xp ayer shall be obliged to correct deduction of the input t a x in a cco rd an ce with
the change on th e basis of a cu sto ms document or a d ec isi on of the cu
stom s b od y. De
duc tio n of the input ta x shall be corrected in the tax period in wh
ich t h e b ase has b ee n c han ged . wYCCICYCYIYIAIgI)CIIx)gCIIB)gIjIYIj)DIAIgI)CIIx)gCIIB)gI)IxC))DIg)gIgIBYxuW)gIBCICY)gIYYD)DI)C)YmIYIxIg)gIBIxIjk
wIIIgCY)DIAIg)DCYIYII)gIBCICY)gC)IYCYIBCICYYmI)IxYg)gIBIAIgI)YvI)IgI)IYIIuWk
Article 32
22

T
he taxpayer who gained right to deduction o f the input tax for acq
uis ition of e qu ipment and structures for performance o f activities, shall be
obliged to correct deduction of the inp ut tax, if no longer me eting the co
nditi ons for e x er cis ing this right, w ithin 5 y ear s from the first use in case of
equipment acquisition, or w ithin 10 years from th e first use in case of acq
uis ition o f st ru ctu res. C
orr ection of deduction o f the input ta x shall be pe rfo rm ed for the pe
rio d between th e deadlines r ef erred to in paragraph 1 of th is article an d t
h e p er iod in which the taxpayer has met the conditions for e n ti tlement to de
duc tio n o f t h e in put ta x . T
he taxpayer s h all also b e obliged to correct th e deduction of the i
n pu t tax when he/she completes th e s u pp ly of equipment and structures f or pe
rfo rm an ce of the activity b ef ore expiry of the ti m e limits referred to in pa
rag rap h 1 o f th is A rti cle . In
case of transfer referred to in Article 6 paragraph 1 item 1 of this L
aw , the ti m e limits re fer red to in paragraph 1 of th is Article s h all not b e t
e rm inated . T
he tr a nsfe ror o f p ro p er ty re fer red to in p ar ag rap h 4 o f th is A rticle s
h all be obliged to s u b mit the data relevant fo r correction mentioned in pa
rag rap h 1 o f th is a rticle to the tr a nsfe ree. T
he Minister shall s p ec if y what is c on sid er ed to be e qu ipme nt and s
tr u ctu res for performing activities, in a cco rd an ce with th is law, as we ll as t
h e m an ner o f c orr ecti ng t h e ded ucted inp ut tax . VIII. SPECIAL TAX REGIME
Small taxpayers
Article 33
A
person w ho se total sup ply of g oo ds and s e rvice s, except s u p ply of eq
uip m en t a nd s tructu res for performing the activity, (hereinafter: total s
u pp ly) h as not exceeded 2.000.000 dinars in the past 12 m onth s, o r wh o, in case
of starting ac tiv ity, estimates that h is total supply will not exceed 2.
000 .0 00 d in ar s in the next 12 months (hereinafter: entrepreneur), shall not be
l iab le for V A T fo r t h e p erf orm ed s u pp ly of g ood s an d ser vic es . T
he entr epr eneur shall not be entitled to d eclare VAT in the invoices or
o th er documents or to deduct the input tax, and shall not b e o b lig ed to ke
ep t h e r eco rds p rescr ib ed by th is L aw . If
total supp ly of the entr epr eneur exceeds 1 .0 00 .00 0 dinars in the pa
st 1 2 months or if the en tre pre neu r e stima te s that his total supply s h all 23

ex
ceed 1.000.000 dinars in the next 1 2 months, the en tre pre neu r may, at th e be
gin nin g of a calendar year, d ec id e to p ay the VAT b y filing a registration fo
rm pres cribe d in accordance with this law to the competent ta x b od y no l
a te r th an by J an uar y 15 of the cu rre nt ye ar. As
f or paragraph 3 of this A rti cle , the VAT liability shall last f o r at l
e as t 2 calen dar yea rs . Up
on expiry of t h e deadline referred t o in paragraph 4 of this A rticle, t
h e taxpayer ma y submit t h e request f o r termination o f his/her VA T liability t
o t h e c omp ete nt ta x b ody no later tha n b y Jan uar y 15 o f t h e c urr ent year. Farmers
Article 34
T
he taxpayer li ab le for cit ize n income t a x on i n com e from a g ricu lture an
d for estr y in the Republic according to the land registry (h erein after : fa
rme rs ), shall b e entitled to c o mpensation on th e basis of the VAT (h
ere in after : the VAT compensation), under cond itions and in the manner de
fin ed b y this law . T
he farmers who perform s u pp ly of agricultural and fo re st products or
provide agricultural service s to the t a xp ayer s shall be en titl ed to the V A T co
mpe nsati on . If
th e farmers perform supply of g o od s and services referred to in pa
rag rap h 2 o f this A rti cle , the ta x pa yer shall be obliged to calculate th e VA
T co mpe nsa tion of 5% for the va lu e o f the received goods and s er vices, on
w hic h th e d oc ume nt o n c alcu lation is to b e is su ed (h er ein after : th e re
ce ip t). T
he taxpayers ref err ed to in p ar agr aph 3 o f this Article shall be en
titl ed to d edu ct the VA T c om pen sa tio n a m ou nt a s t h e in put t a x , p ro vid ed t
h at th ey h av e p aid th at co mpe nsati on an d va lu e o f rece iv ed g oo ds a n d s
er vic es to a fa rme r. At
the b egin nin g of the calendar ye ar, the far mer may d ecide on pa
ym ent of V A T by s u bm itting a reg istra tio n f orm prescr ib ed by th is L aw to t
h e competent ta x body n ot later th an January 1 5 of th e current y ear , pr
ovid ed that his/her total s u p ply of agricultural and fo res t products or ag
ric ultur al s e rv ice s fo r t h e p ast 1 2 mo nths e xcee ds 1. 000 .0 00 din ars. As
to paragraph 5 of thi s A rti cle , the farmer shall be liab le f o r VAT fo
r at le as t 2 calen dar yea rs . 24

Up
on expiry of t h e deadline referred t o in paragraph 6 of this A rticle, t
h e farmer m ay submit a request fo r termination o f VAT li ab ili ty to th e co
mpe te n t tax bo dy no l a te r th an J an uar y 15 of the cu rre nt ye ar. Travel agency
Article 35
T
rav el a g en cy, in accordance with this Law, shall be a taxpayer who pr
ovid es to uris t se rvice s and acts on his behalf, and receives goods an d s
er vic es directly used by pa sse ng ers from other taxpayers (h er ein after : pr
evio us t o uris t ser vices) fo r o rg an izing the t r av el. T
our ist service pr ovid ed by a travel agency s h all be considered a un
ique s er vic e in acco rd an ce with this L aw . T
he location of providing th e unique tourist service sh all be de
te rmin ed i n co mplian ce w ith A rti cle 1 2 p ar ag rap h 1 and 2 of this L aw. T
he base of unique tourist service p ro v id ed by travel agency shall be t
h e dif fer ence between the total fee p aid b y the passenger and actual c o sts pa
id by tra vel agency f o r previous to uris t services, w ith the d edu ctio n of VA
T in clud ed in th at dif fer en ce. As
for Article 5 p ar agr aph 4 of this L aw, the total fee in terms of pa
rag rap h 4 o f th is A rti cle sha ll b e t h e a m ou nt r e fe rre d to in A rticle 1 8 o f t
h is L aw . T
rav el agency may determine the bas e i n accordance with paragraphs 4 and 5
of this Arti cle for g rou ps of tourist services or f or all tour ist services pr
ovid ed in th e tax pe rio d. For
th e tourist services referred to in paragraph 1 of this Article, t
o uris t agency s h all not b e entitled to state V A T in th e invoices o r deduct t
h e in pu t ta x on t h e basi s o f pr evio us t o uris t ser vices st ate d in th e inv oice. Used
goo ds, o bj ect s o f ar t, collect ion wor k a nd antiquities Article 36
T
he base for supply of used goods, includ ing used vehicles, objects of ar
t, co llecti on w or k an d an tiq uiti es s h all b e th e d if fer en ce b etwe en th e s
ell ing and p urch asing price o f the g oo ds (hereinafter: tax atio n of dif
fer en ce), w ith d ed ucti on of V A T i n clu ded i n t h at d if f er enc e. 25

T
he base r ef err ed to in p ar agr aph 1 o f this Article shall be ap pli ed if, fo
r acquiring goods, the s u p plier was not liable fo r VAT or carried ou t t
a xa tio n o f t h e d iffe ren ce refe rre d to i n p ar ag rap h 1 of t h is Ar ticle . As
for Article 4 p ar agr aph 4 of this L aw, the selling price fo r calcu
lation of the difference shall be th e amoun t stated in Article 18 o f this L
aw . For
the supply of goods from paragraph 1 of this A rticle, the t a x pa yer s
h all not be entitled to state t h e VAT in the invoices or oth er documents, or t
o d ed uct th e inp ut tax . T
he Minister shall specify w hat is considered to b e the object of a rt, co
llec tio n w ork a nd antiqu ities r efe rre d to i n p ar ag rap h 1 of t h is Ar ticle . I
X . TA XPAY ER OB LIGATI ONS FO R SUPP LY O F G OO DS A ND SE
RVIC ES Article 37
T
ax pay er s h all b e ob lig ed t o : 1) s
u bm it a V AT f o rm ( h er ein afte r: r eg istr a tio n fo rm) ; 2) i
s sue i n vo ic es o n c omp leted s u p ply of go ods an d s er vic es ; 3) ke
ep t h e r eco rds in acc ord anc e with t h is L aw ; 4) de
te rmin e an d p ay the V AT, and f ile tax d eclar atio ns. wIFIYYgI)IIIgCYIBIgI)CIIx)gCIIB)g)I)C)m)gC)IBCDIYCYII)gIBIxIj)gIgICIYI)CYuW)gCYIYYmCIYvIB)F)gIBCYCIYm)gIgICIY)gCYIYYgI)IIIgIYCYk
Article 38
T
he ta x pa yer w ho se total su p ply fo r th e pas t 12 m on th s h as e xc eede d 2.
000 .0 00 din ars, o r w ho , w hen s tar tin g a bu sin es s a ctivit y, e sti m ates th at s
u pp ly will e xcee d 2 .0 0 0. 000 d in ars i n the ne xt 1 2 m onth s, s h all b e o bli ged t
o f ile a reg istra tio n f orm to t h e com peten t ta x bod y not la te r th an u ntil the ex
pir y of t h e first d ea dline fo r f ili ng a per iod ical tax re tu rn . T
he follow ing per so n s s h all n ot b e liab le t o f ile a reg istra tio n f orm : 1) pe
rs o ns r efe rre d to i n A rticle 10 par agr aph 1 Item 2 ) a nd 3) he reo f, if t
h ey ar e no t tax paye rs ; 2) t
a xp ayer s w ithou t a hea d o ffic e or a pe rma nen t b usine ss u n it in t h e R
epu bli c ( her ein af ter : foreig n tax pay er); 3) E
ntr ep ren eur s w ho h ave no t de cid ed t o p ay VAT; 4) Far
mers w ho h av e not d ec id ed to pay VAT. 26

T
he co mpeten t tax b od y sha ll iss ue a ce rtif ic ate on th e co mple te d VA
T r eg istra tio n to t h e tax pay er. T
he taxpayer s h all be ob liged to n o ti fy the co mpeten t tax b od y in wr
itin g of any c ha nge of data relev ant to calculation an d payment of VA
T in its registration form f rom paragraph 1 of this Article within 15 da
ys f ro m the day of t h e cha nge . T
he taxpayer shall be ob liged to enter the ta x identification nu
mber ( he reina fte r: TIN ) in all doc ume nts in acc ordan ce w ith th is Law . Article 39
At
the request fo r termination of V AT liability of th e taxpayer re
fer red to i n A rticle 3 3 p ara gra ph 3 an d Ar ticle 34 p ar ag rap h 5 o f t h is L
aw , the c om peten t tax b od y shall c on duct an ap pro pria te verification an
d is su e a cer tifica te o n r em ovin g th e tax paye r f ro m th e VA T re gis ter . T
he competent tax b od y shall remove th e taxpayer from th e VAT re
gis ter , ex officio and u po n conducted procedure, if th e total supply of t
h e taxpayer ha s not ex ceed ed 1.000.000 d in ars in t h e past ca le n da r year. T
he co mpe te n t tax body shall then issue the certificate referred to in pa
rag rap h 1 h er eo f. Article 40
Prio
r to removal from the register o f b usiness es, or other register i
n a cco rda nce with the law (hereinafter: register) of the body auth orize d t
o keep the re gis ter , the taxpayer termin ating the activity s h all be obliged t
o submit a request f o r removal f r om the VA T register to the c o mp ete nt t
a x bo dy not later than 15 days prior to the re moval fro m th e pu bli c re
gis ter . T
he co mpeten t tax b od y sha ll co nd uc t th e p ro ced ure an d is su e th e cer
tifica te o n r em ova l f ro m the V AT r egis ter. T
he bo dy authorized to keep the re gis ter sha ll not be entitled to re
mov e the taxpayer from th e relevant register without th e certificate re
fer red t o i n p ar ag rap h 2 o f t h is A rticle. T
he ce rtifica te re fer red t o i n A rticle 38 p ara gra ph 3, an d A rti cle 3 9 he
reo f a nd par agr aph 2 of this A rticle sh all in clude t h e fo llo win g da ta : 1) na
me an d ad dre ss o f th e tax paye r; 2) da
te of is su e of c er tificate on VA T r eg istra tio n o r V AT d ere gis tr ati on ; 27

3) T
IN; 4) da
te of s tar ting t h e acti vit y, d ate of VA T r eg istra tio n o r de
reg ist ration .
T
he co mpeten t tax b od y sha ll keep the re co rd s on all th e tax paye rs wh
o h av e bee n issu ed ce rtif ic ates f r om p ar ag rap h 4 o f t h is A rticle. Article 41
T
he M in is te r sha ll pre scr ib e th e r egis trati on fo rm an d th e proc ed ure of
V A T re gis tr ati on an d de reg ist ration . Issuing of invoice
Article 42
T
he ta xp ayer shall be obliged to is su e a n invoice or other document s
er vin g as an invoice (hereinafter: invo ic e) fo r each supply of goods o r s
er vic es p er fo rme d f or oth er t a x pa yers. T
he ta x pa yer shall also be obliged to issue an invoice r ef err ed to in pa
rag rap h 1 o f th is A rti cle if he /she re ce iv es c o nsi der atio n o r a p ar t o f th e co
nsid era tio n prior to supply of goods a nd services (a dva nce payment), wh
ere by advance payments including VAT are d ed ucted in the final s
ta te m en t. T
he in v oic e sh all in clude t h e fo llo win g da ta : 1. Na
me, ad dre ss an d t h e TIN o f th e tax paye r- in vo ice issu er; 2. L
ocation an d d ate of is su e, an d i n v oic e nu mb er; 3. Na
me, ad dre ss an d t h e TIN o f th e tax paye r- in vo ice recipien t; 4. T
yp e a nd q u an tity o f th e d eli ver ed g oo ds, o r ty pe an d v o lum e o f s
er vic es ; 5. Da
te of supply of goods an d services a n d the amount of advance pa
ym ents; 6. B
ase am oun t; 7. T
he ap plied tax ra te ; 8. VA
T a mo unt c alcu la te d f or t h at bas e; 9. No
te on tax ex emp tion . 28

T
he invoice shall b e issued in a t least two c op ies , one of w hic h shall be
kept with the issuer of th e invoice, whereas others shall b e g iv en to the re
cip ie nt of goo ds a nd se rvice s. Article 43
T
he invoice referred to in Article 42 paragraph 1 of this Law s h all als
o be a do cum ent on calculation is su ed by the t a x pa yer as a r ecip ie n t of go
ods and services, on the basis o f w hich the commission for supply of go
ods an d s er vic es is t o b e deter min ed, if: 1. T
he t a x pa yer- r ec ip ien t o f go ods an d s er vic es is en titl ed to en te r th e VA
T in th e inv oice; 2. T
he ta xp ayer issuin g the document on calculation and the taxpayer re
ce iv ing the document on calculation have ag reed that the calcu
lation of s u ppl y of goods and services is to be performed by th e re
cip ie nt of goo ds a nd se rvice s; 3. Do
cum ent on calculation has been submitted to the taxpayer who de
liv er ed g o od s o r s er vic es ; 4. T
he t a x pa yer w ho d eliv ered g oo ds an d s er vices h as ag reed in w riting with
the stated VA T. Article 44
If
the VAT liability reported b y th e taxpayer in his invoice is h ig her t
h an the liability according to the law, the tax paye r shall be obliged to pay t
h e stated V A T am oun t un til it has b ee n cor rec te d in t h e new inv oice. Ar
ticle 21 paragraph 6 of this law shall be applied for co rr ec tio n o f t
h e in vo ice in acc ord anc e with t h is l a w. If
the person w ho is not li able for VAT o r has not pe rfo rm ed supply of
g oo ds an d services, or is not entitled to declare VAT, dec la res V A T in t
h e in vo ice or s o m e oth er d o cu men t, h e sh all b e liab le fo r d eclar ed VAT. Article 45
T
he M in is te r sha ll sp ec if y when t h e tax pay er i s u nder n o oblig ati on t o i
s sue an in vo ic e, when c er ta in data m ay be o m itted in the invoice, or when ad
diti on al sim pli fication regarding issuing of an in voice m ay be provided fo
r. Obligation of keeping records
29

Article 46
In
o rde r to co mpu te an d p ay th e V AT p ro p er ly , th e tax paye r sha ll ke
ep t h e r eco rds th at enab le cond uc tin g a n a udit. T
he Minist er shall specify the form, co nte nts a n d manner of record ke
ep ing . Article 47
T
he taxpayer shall be obliged to k eep the records ref err ed to in Ar
ticle 46 hereof for at l e as t 5 years upon the expiry o f the calendar year to wh
ich t h e r eco rds r efe r. w)mIBYx)gC)IYCYI)CIIjCB)gIBI))FI)IxYg)gIgICIY)gIgIBYx)gCYIYIg)DCYIxCB)gIAuWIB)FIA)D)FIBIgI)CIIx)gIBIxIj)gC)IBCDYmIYIxIg)gCIIB)gIgICIY)g)I)C)mk
Article 48
T
ax pe rio d fo r which the VAT is calculated, tax return is filed, an d t
h e VAT is paid, shall be a calendar month for the taxpay er w hose total s
u pp ly in the past 12 m onth s has ex ceed ed 20.000.000 dinars, or who es
tim ate s that his/her to tal supply for th e next 12 mo nths will exceed 20
.0 0 0. 000 d in ars. T
ax pe rio d fo r which the VAT is calculated, tax return is filed, an d t
h e V AT is paid, shall be a calendar three-month period for th e ta x pa yer wh
ose total supply in the past 1 2 months has no t exceeded 20.000.000 din
ars, or who estimates th at his/her total supply for the next 12 m onth s will no
t ex ceed 20 .0 0 0. 000 d in ars. T
he taxpayer r ef err ed to in paragraph 2 of th is Article sha ll submit a re
que st for change of the tax perio d to one calendar month, to th e co mpe te n t t
a x bod y by Jan uar y 1 5 o f th e cu rr en t c alen dar yea r a t th e la te st. T
he approved tax period r ef er red to in paragraph 3 of this Article s
h all las t fo r at le as t 12 m onth s. For
th e tax paye rs starting a business activity in the current calendar yea
r, the tax period sha ll be a calendar m onth for the current a nd the next calen
dar ye ar. Article 49
30

T
he taxpayer shall be ob liged to calculate the V A T for the relevant t
a x period on the basis of the total supply of goods and s er vices in tha t pe
rio d, if , in accordance with Article 14 hereof, such goods and s e rv ic e s ha
ve become li ab le for ta xa tio n, and at the sam e time, the taxpayer is a t a x de
bto r. Wh
ile calcu lating th e V A T, co rr ection s f ro m A rticle 2 1 an d A rti cle 44
, p ar ag rap h 1 her eof s h all b e a lso tak en into co nsid era tio n. T
he VAT c alculated in accordance with paragraph 1 and 2 of this Ar
ticle shall be r ed uce d by the i n p ut tax amount ac co rdin g to Article 28 , 30 an
d 3 4 h er eo f. For
calculation o f the in pu t tax u nd er paragraph 3 of th is Article, co
rre cti on s referred to in A rti cle 31 and 32 h er eo f shall also be tak en into co
nsid era tio n. VA
T at import shall be deducted from the V A T in the tax p er iod in wh
ich i t has b ee n paid . E
xcep tion ally fr om t h e provision under paragraph 1 of this Article, in case
of transportation of passengers across th e state border by buses pe
rfo rm ed by fo reign taxpayers, the competent customs body shall calculate t
h e VAT for each transport (hereinafter: in div idu al taxati on of transport) un
der r ec ip ro cit y r ule. Article 50
T
he taxpayer shall file the tax r etu rn to the competen t tax body o n the pr
escr ibe d f orm w ithin 10 d ays u pon e xpir y of th e tax pe rio d. T
he ta xp ayer sh all file the tax return regardless of whether the t
a xp ayer is l iab le for V A T i n t h at tax pe rio d. T
he tax debtors re fer red to in A rticle 10 paragraph 1 item 2 an d 3 and Ar
ticle 44 p ar ag rap h 3 o f t h is l a w sha ll als o be ob liged to file t h e tax r etur n. T
he t a x return under paragraph 3 of this Article shall be f iled f o r th e t
a x per io d in w hich t h e V AT l iab ility occu rred . Article 51
For
each t a x period, the t a x pa yer shall b e under obligation to pay th e VA
T equal to th e positive difference b etw ee n the total t a x liability amount an
d th e inp ut tax am oun t, w ith in t h e time lim it fo r f ili ng t a x r e tu rn s s ta te d un
der A rticle 50 , p ar agr aph 1 he reo f. X. TAX REFUND AND REIMBURSEMENT
31

Tax refund
Article 52
If
the input tax amount is h igh er than the tax liability amoun t, th e t
a xp ayer s h all b e e ntit led to a r efu nd of the dif fer en ce. If
the tax paye r decides not to take th e refund under paragraph 1 o f t
h is Ar ticle , th e dif f er enc e sh all b e r eco gnize d a s t h e tax cr edit. R
efu nd under p ar ag rap h 1 o f this A rticle shall b e issued w ith in 45 da
ys, o r w ithin 15 days for taxpayers who mainly perform supply of go ods ab
roa d, u po n th e ex pir y o f t h e time l im it fo r f ili ng t a x r etu rn s. T
he Government of the R epu bli c of Serbia shall d ef ine criteria for de
te rmin in g w ha t, ac co rd in g to th is la w , s h all be un der sto od a s s u pp ly o f go
ods an d s er vic es m ain ly ab roa d. T
he Minist er shall specify the procedure of becoming entitled to VAT re
fun d. wIFIYI)Ym)E)DCYIIIYYmIYIxIg)gCIIB)g)I)C)m)gIgCI)gIgICIY)gIBCICYIYI)YgIx)guWIgIBYxC)IBCDIYCYk
Article 53
R
eim bu rsem ent of VA T shall be m ad e to the foreign taxpayer, at his
/her request, if th e foreign taxpayer h as settled liability an d met the co
nditi ons defined by this law f or becoming en titled to deduction of the i
n pu t tax , p ro v id ed tha t th e for eig n t a xp ayer : 1)
does not carry out th e supply of goods and ser vices in th e R
epu bli c, 2)
renders only tax ex emp t services in accordance w ith Article 24, pa
rag rap h 1 , i tem 1 an d 8 h er eo f; 3)
p er fo rm s o nly th e tr an sp o rtation o f p ass en ger s li ab le to th e i
n div id ua l tax ation o f tr an sp ort in a cco rd an ce with A rticle 4 9, p ara gra ph 6 he
reo f. As
f o r p aragraph 1 of this Article, VAT reimbursement shall be made un
der r ec ip ro cit y r ule. H
um ani taria n or ganizations Article 54
32

On
th e b asis of the filed request, the organizations registered for pe
rfo rm in g humanitarian activities shall be entitl ed to VAT reimbursement fo
r the goods delivered to them in the Republic or for th e im por ted goods, pr
ovid ed th at: 1)
T he su p ply /im por t of g o od s is t a x ab le . 2)
The VAT f or the delivered g o od s has been s ta te d in the in vo ice , in acc
ord anc e with Ar ticle 42 h er eo f, and p aym ent has be en made, o r the V AT l
iab ilit y ba sed o n im por t of g o od s h as a lr e ad y bee n se ttled ; 3)
The purchased goods ha ve been dispatched abroad w her e used for hu
man itaria n, ch aritab le or ed uca tio n p urp oses . F
oreig n donors Article 55
On
the ba sis of the re que st, th e f or eig n do nors pr ovid in g f ina ncial re
so u rc es for realization of the p ro je cts in the Republic shall be entitled to t
h e VAT reimbursement f or the goods d eli ver ed to them i n the Republic o r t
h e goods they h ave imported, as w ell as for o th er services provided to t
h em , i f : 1)
d eli vere d o r i m porte d goo ds, or re nde red s er vic es a re t a xa ble , 2)
the VAT on supply o f goods an d services has be en stated in the i
n vo ic e, in accord ance with this la w , and th at the payment has been m ad e, an
d/o r the VAT liability b as ed on the import o f goods has already b een s
ett led , 3) th
e donor funds for the pro je cts are based on the agreement ente red with
Serbia and Montenegro, i.e. th e Rep ublic, and the tax costs a re n o t to be
co ver ed b y th e r eceiv ed f in an cia l ass ets. R
eim bur sement of input ta x t o a f ore ig n cit iz en Article 56
At the
req uest of a f oreign citizen n ot liable for taxation and w ithou t a re
side nce in the Republic, the VAT reimbursement shall be carried out un
der co ndition s laid in Ar ticle 24 p ar ag rap h 1 item 4 her eof . 33

Article 57
T
he Min ist er sh all specify the manner and procedure of tax re
im burs em ent re fer red t o i n A rticle 53 -5 6 h er eo f. w)BYICx)gCC)C)xYCYI)C)Y)gIF)xIC)j)Y)C)mYIImCjCC)gYBImIF)gYIYA)CImIF)m)gImuWYB)gICImIm)vCCk
Article 58
C
usto ms regulations shall be applied to the VAT on import o f goods, un
les s o therwis e pr ovid ed fo r b y th is Law . Article 59
T
he customs body conducting the cu stoms p ro ceed ings shall be re
sp o nsi ble fo r calculating and collecting VAT o n im port of goods, unless oth
erwise pro vide d f or by t h is L aw . XII. PENALTY PROVISIONS
Article 60
T
he taxpayer – l e g al entity shall b e fined from 1 00 .0 00 to 1.000.000 din
ars f o r th e vio lati on, p ro v id ed tha t h e/s he: 1)
fails to fu lfill the liabilities pr ovid ed for by th is Law (Article 1 0 , pa
rag rap h 2 ); 2)
does not correct the V AT liability, o r does not c alculate the V A T i
n ca se of c han ge of th e ta x b ase (A rticle 21) ; 3)
exercises the rig ht to deduction o f the input V A T, without having do
cum entation n ec essa ry for tha t ( A rticle 28 , p ar agr aph 2 ); 4)
d ed ucts th e in put V AT fo r de liv er y o f go ods an d re nde rin g of s
er vic es w ithou t b ein g entit led t o tha t ( A rticle 29 p ara gra ph 1); 5)
f ail s to co rre ct th e in pu t VA T d ed uction ( A rticle 31) 6)
fails to correct the in put tax d educti on for equipment and structures fo
r p er for man ce of acti vit ies ( A rticle 32 , p ar agr aph 1 -3) ; 34

7)
fails to provide the r ecip ie n t with t he data necessary for correction of
the i n pu t V A T (A rti cle 3 2, pa rag rap h 5 ); 8)
states the VAT in the in vo ice o r other document, or deducts th e i
n pu t VAT witho ut being en titl ed to it (Article 3 3, paragraph 2 , Article 35 , pa
rag rap h 7 ); 9)
deducts th e VAT co mpen sa tio n amount a s the in pu t tax w ithou t ha
vin g paid that VAT compensation a n d v alue of received goods and s
er vic es ( A rticle 34 p ara gra ph 4); 10
) d oe s n ot iss ue th e in voice (A rti cle 3 7, i tem 2 a nd article 42) ; 11
) do es not keep the prescribed re co rds (ar ticle 37, item 3 and Ar
ticle 46 ); 12
) d oe s n ot calc ulate the V AT ( Article 37, item 4 and A rticle 49 ); 13
) do es not pay the VAT within t he prescribed term (Article 37, item 4
and A rticle 51 ); 14
) does not submit th e registration form within th e prescribed term (A
rti cle 3 8, pa rag rap h 1 an d A rticle 63) ; 15
) does n ot inform th e TA of the ch an ges of da ta in h is registration fo
rm or on termination o f the activity (Article 3 8 , paragraph 4 and A rticle 40
p ar ag rap h 1 ); 16
) does not state the T IN in all documents prescribed by th is L aw (A
rti cle 3 8, pa rag rap h 5 ); 1
7) do es no t ke ep t h e r eco rds w ithin th e pres crib ed t e rm (A rticle 47 ). T
he re sp onsi ble person within the legal entity shall also be fined wi th 10
.0 0 0 to 50.000 dinars for the v iolation refe rre d to in paragraph 1 o f this Ar
ticle . T
he entrepreneur shall be fined w ith 12.500 t o 500.000 dinars for the vio
la tio n r efe rre d to i n p ar ag rap h 1 of t h is Ar ticle . T
he responsible p er so n of the court, lo ca l self-government b od y, l
a wy er’s association, pro fessio nal association, or any other bo dy or or
gan iza tio n competent for entering into t he r elev ant register, shall be fined be
tw een 1 0,000 and 50,000 dinars if such pe rs o n removes the taxpayer from t
h e reg ister witho ut th e ce rtif ic ate ref er red t o in Article 40, p ara gra ph 3. XIII. TRANSITIONAL
REGIME
35

Article 61
T
he Government of Republic of Ser bia s h all regulate application of t
h is law on the territory o f Autonomous Pr ovin ce of Kosovo and Metohija i
n the period of ef fec tiv en ess of Security Council Res olution of the United Na
tio ns Or gan iza tio n, n o . 1 24 4. w)BYI)ICx)g)mIF)CCjCCYI)mYIImCj)C)Y)g)CCj)v)gYBYICj)C)Y)g)CIFIm)IYICCYIImuWCjCCk
Article 62
Pro
vis io n s of this law shall be a p plied to all s u p ply of goods a nd s
er vic es a nd imp ort o f go ods p er for med as o f J an uar y 1 , 2 00 5. If
the tax paye r has paid s a le s tax fo r the issued invoices or r ec eiv ed ad
van ce payments by and including D ece mbe r 3 1 , 2004, and the supply of go
ods/s er vic es has been performed after January 1, 2005, the taxpayer m ay re
duc e the VAT li ab ili ty for delivered g oo ds and services in the tax p er io d by
t h e sa le s t a x a m ou nt th at has b een p aid . If
deli ver y of goods/services is performed in p arts in terms of Article 14
, paragraph 4 and A rticle 15, paragraph 3 he reo f, provisions of this L aw s
h all b e applied to that part of the supply of go ods an d s er vices th at has be
en performed begin ning with January 1, 2005, a n d provisions of the Law on
Sales Tax shall be applied to the part performed b y a n d in clu din g De
cemb er 31, 2 004 . T
ax pay er shall be obliged to pr epa re the li st of issued invoices and re
ce iv ed advance payments referred to in article 2 he reo f and submit it to t
h e com peten t ta x bod y by Jan uar y 1 5, 20 05 at th e lates t. Article 63
T
he person who has made o r estimates th at he/she will make total s
u pp ly of goods and services e x cee ding 2 .0 00 .0 0 0 dinars in the 12 mo nths pr
eced ing the day of filing a VAT registration form referred to i n A rticle 3 7 i
tem 1 hereof, shall be obliged to file a VAT registration form to the co
mpe te n t tax bo dy by Se ptem ber 3 0 , 2 00 4 at the l a te st. T
he person who has made o r estimates th at he/she will make total s
u pp ly of goods and services e x cee ding 1 .0 00 .0 0 0 dinars in the 12 mo nths pr
eced ing the day o f filing a V AT registration form re fer red to in p ar ag rap h 36

1
o f th is Ar ticle , m ay f ile a V AT r eg ist ration fo rm to th e co mpeten t tax bo
dy, b u t n o t later t h an Sep tember 3 0, 2 0 04 . Article 64
Ac
cord in g to this Law, on December 3 1, 200 4, the VAT payers shall be
under obligation to make th e lis t of inventories of tobacco pr oducts, alco
holic beverages, coffee, motor f u el, diesel fuel and h eati ng oil found on t
h e location and i n ten ded for further s u p ply, and determine th e sales tax o n go
ods for the se, which is calculated at purchase a nd paid th rou gh the pu
rch ase pric e or at imp ort. T
he taxpayer may use the tax determined un der paragraph 1 of this Ar
ticle as the input tax in accordance with provisions of thi s Law if the t
a xp ayer uses these products for s u pp ly of good s and services, a n d if h e is en
titl ed to dedu ctio n of t h e in pu t ta x. T
he in p ut tax referred to in paragraph 2 of this Article m ay b e de
duc te d in the amount p ro po rti onal to the performed s u pp ly of goods and s
er vic es in futur e tax p er iod s. T
he taxpayer shall not be e n tit led to refund of the d ete rm ined sales t
a x liab ili ty ref err ed to in pa rag rap h 1 o f th is A rti cle . T
he taxpayer shall be under o bliga tio n to s u b mit the inventory lists re
fer red to in paragraph 1 hereof as well as the l ist o f s u pp lier s, t hat is, list of
customs d eclara tio ns for the products referred to in paragraph 1 hereof, to t
h e com peten t ta x bod y by Jan uar y 1 5, 20 05. T
he Minister shall specify m an ner of gaining right to deduction of s
ales tax as in pu t ta x. Article 65
Ac
cord in g to this la w , the VAT p ayer s shall be ob liged to make an i
n ven tor y o f th e n ewly b uilt st ru ctu res an d th e s tr uctur es th at ar e b ein g bu
ilt, on D ec em ber 31 , 2 00 4. T
he newly built s tru ctu res not delivered or paid by D ecem ber 31, 20
04 shall be li able for taxation in accordance with th e law regulating pr
oper ty ta x es . T
he value of structures, b uild in g of which is in progress, and which ar
e to be delivered from J a nu ary 1, 2 00 5 ,
shall be determined on D ecem ber 31
, 2 004, and these structures shall be liable for taxation in acc ord anc e w ith t
h e law r eg ula tin g pro pe rty tax . 37

T
he value of structures referred to in paragraph 3 of this A rti cle an d de
te rmin ed from January 1, 2005 s h all be li a b le for taxation in accordance with
this law . T
he taxpayer shall be obliged to sub mit the inventory lists referred t o i
n paragraph 1 of this Article to t he competent tax body by Ja nu ary 1 5, 2005 at th
e lates t. Article 66
T
he Law on Sa le s Tax ("Official G az ett e of the R epu bli c of Serbia", no
. 22/2001, 73/2001, 80/2002 an d 70/2003) shall be app lied for calculation an
d payment o f sales tax o n goods a n d services, liabilities of which h av e oc
cu rr ed by De cemb er 31, 2 004 . Article 67
With
the day this Law c o me s into e ff ect, the Law on Value A dded T
ax shall cease to b e valid (“Official Gazette o f the FRY”, no. 74 /99, 4/2
000 , 9 /2 00 0, 6 9 /2 00 0 and 7 0 /2 00 1) . T
he Sales T ax Law ("O fficial Gazette o f the RS" , no.22/01, 7 3/0 1, 80
/02 and 70/03) and r eg ulati ons passed on the b asis of that law s h all cease t
o b e valid on January 1, 2005, whereby Decree on M ann er o f K eep ing R
eco rds of Supply through fiscal C ash Registers and Schedule for In
trod uction o f s u ch Cash Registers ("Official Gazette of the RS", no.5/03, 39
/03, 7 2/0 3, 2 /04 , and 31/04) and regulations passed on the basis of th at de
cree shall be applied until th e application of the law re gulating i
n tro ducti on an d ke ep ing r ec ords o f sup ply th ro u gh f iscal cash r egis ters. Article 68
T
his Law s h all come into ef fect on the eighth day from the da y of its pu
bli sh in g in th e “O fficial G aze tte o f th e Rep ub lic o f Se rbia” an d sha ll b e ap
plied as o f J an uar y 1, 20 05, W89Eq8q89E"8k80E"8UEEEM8M8"8MEEE88"80EEE9808E8U8k8M8q8/8980UqU–808M8k89UELT808zUk808E8U8k8M8q8/89j
63
, an d pr ovisi ons h er eo f re gulating au thor ity t o p as s r eg ulati ons, t h at s h all be
ap plied f ro m t h e d ay th is L aw co mes in to ef fec t. 38