tion of the current dynamics? – The increased volume of investments is primarily the result of the efforts of the Government, which established macroeconomic stability and provided for the predictability of the business environment. Successfully implemented fiscal consolidation, balancing the balance of payments imbalance, price stability and a clear course of reforms aimed at strengthening the competitiveness of the domestic economy are factors that can largely define the decisions of investors regarding whether to start their investment cycle in Serbia or not. We expect that in the future a large number of major investments in third generation will appear, which will valorise the economic position of Serbia and have a regional scope.
citizens need to respond to that by voluntarily and transparently reporting their income and paying taxes.
► When will Tax Administration be thoroughly reformed? – Plans for the transformation of the Tax Administration have already been prepared and their rapid implementation is expected soon, which will involve a smaller number of better organised regional offices of the Tax Administration. Likewise, reform is also being implemented through the system of recruitment, training, advancement and remuneration of staff, strengthening the material base of the work of the Tax Administration and technical and technological modernisation. The process of transformation of the Tax Administration into a modern organised unit modelled on the administration of Western European countries is a long lasting process that we have already agreed with representatives of the World Bank and the IMF, it is realised in phases and is gradually yielding the first results. The state should be careful what and how much it taxes, the Tax Administration needs to be a credible threat of law enforcement and
► What kind of rank do you envisage for Serbia on the next Doing Business list? – Last year saw Serbia advance 32 positions thanks to the recognition of reforms in the areas of paying taxes, to some extent due to the new system for issuing building permits and following changes to the methodology that finally placed on an equal footing the position of continental countries with those bordering the sea. It should be considered that each country’s ranking on the Doing Business list depends on the success of other countries. However, we expect that on the Doing Business list for 2017, which the World Bank will publish in October, we will have progressed by around a further four places, so we will achieve 55th place, and that in 2017 we will advance by a further 7-10 place and break into the top 45 to 50 world economies.
► Foreign investors continue to note their satisfaction with the new Labour Law and the speed of issuing building permits. On the other hand, the Law on Land Conversion, with great delay, has only just entered into the application, while there is still no Law on Para-fiscal Charges. What novelties can you announce when it comes to improving the business environment? – The effects of the reform of the Labour Law are as we expected them to be - there has been growth in employment and a reduction in unemployment and inactivity. The effects of the reform of the system for issuing building permits are even more positive. The growth of construction in the past year and a half is one of the pillars of the new momentum of the economy. When it comes to the further improvement of the business environment, in the short term we will regulate the financing of local governments, and our plan is to work intensively on the reform of fees and charges, in order for us to have a more transparent system.
► What will be in the focus of the government when it comes to combatting the grey economy? – The continuation of the fight against the grey economy remains a task that is ranked very highly among the priorities of the Government. The results achieved in 2015 and 2016, which were largely the result of more intense controls, must be translated into lasting improvements in the administration system and reform of the Tax Administration itself. Coordinated efforts of the Tax Administration, the Interior Ministry and the Security Information Agency achieved notable reslts in the fight against illicit trade in excisable goods. This kind of cooperation will also be continued in the period ahead.
If we want to make it into the global premier league of countries with the best business environment, we have a lot of work ahead in order to continue improving in practice
► Although the results of economic growth and the inflow of investments are encouraging, the unemploy-
THE VIEW ON 2016/17 FOREIGN INVESTORS COUNCIL IN SERBIA 15