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Serbia to raise reduced VAT rate to 10% in crisis measures

  • VAT
  • 09 October 2013 | Richard Asquith

Serbia to raise reduced VAT rate to 10% in crisis measures

Plans to raise the Serbian reduced VAT rate from 8% to 10% have been issued.

Serbia’s current standard VAT rate is 20%, following a 2% rise in October 2012.  The reduced Value Added Tax rate applies to foodstuffs, medicines, agricultural goods, books and newspapers, public utilities and live events.

In addition, a number of other products will move from the reduced VAT rate of 8% to the standard rate of 20%. This may include hotel accommodation and IT services.

Economic troubles force VAT increase

The potential VAT rise is part of a package of stabilisation measures being introduced as Serbia looks to progress its EU membership talks.  Serbia is hoping to borrow significantly from the UAE in emergency loans as it faces a liquidity crunch, and faces a 7% deficit.  The aim is to reduce this to 2%. Serbia recently failed to secure funding from the IMF following a failure to cut spending and public sector wages.

The rise will come in on January 2014.


VP Global Indirect Tax
Richard Asquith
VP Global Indirect Tax Richard Asquith
Richard Asquith is VP Global Indirect Tax at Avalara, helping businesses understand their compliance obligations as they grow globally. He is part of the European leadership team which this year won International Tax Review's Tax Technology Firm of the Year. Richard qualified as an accountant with KPMG in the UK, and went on to work in Hungary, Russia and France with EY.