Mugoša: We expect support for the introduction of a non-taxable part of earnings

Mugoša also stated that Montenegro has the lowest income tax rate in the region, but due to the lack of a non-taxable part, a higher amount of income tax is paid than in most countries in the region.

Mugoša, Photo: Savo Prelević

Social Democrat (SD) MP Boris Mugoša said that they expected the support of the majority of MPs in their party to their proposal for amendments to the Law on Personal Income Tax, which envisages the introduction of a non-taxable part of earnings.

Mugoša announced that the Government submitted to the Assembly the opinion that the proposed amendments to the law, which the party submitted a month ago, should not be accepted.

“SD deputies will nominate the Bill which envisages the introduction of a non-taxable part of the salary for the agenda of the next session of the Parliament, and we believe that they will get the support of the majority of deputies. “After all, the majority of parliamentary parties are in favor of a system of progressive taxation of salaries,” Mugosa said in a statement.

Mugoša said that the SD is absolutely ready to accept any amendment that will be in the direction of improving the legal text.

He believes that the introduction of a non-taxable part of wages is a fiscal measure aimed at improving the position of employees, because it should result in an increase in their net wages with the fact that it will not increase costs for employers.

“It is also a measure that does not tax the part of the salary that serves to cover the subsistence minimum and whose benefits would be felt by a large number of employees, ie all those whose salary is below the average in Montenegro,” Mugoša said in a statement.

He also said that it was a measure that would contribute to the increase of personal consumption of a large number of citizens, which dropped significantly due to the negative consequences of the COVID-19 pandemic and which would positively affect the business environment, ie the position of employers and employees.

“It is also a measure that is socially just, because it will provide additional funds to all those who receive below average earnings and is essentially a form of progressive taxation,” said Mugosa and reminded that this measure exists in almost all countries in the region and most EU countries. (EU).

He said that the proposed solution would put a minor “burden” on the state budget, because additional funds of employees would be returned to the system through increased personal spending.

Mugoša also stated that Montenegro has the lowest income tax rate in the region, but due to the non-existence of the non-taxable part, a higher amount of income tax is paid than in most countries in the region.