Lower VAT rates on food, apartments

Serbian Minister of Finance Mladjan Dinkic announced today that value added tax (VAT) rates on some food products, tickets for sports and cultural events, and real estate will be lowered by the end of June.

Dinkic told B92 that the VAT rate on new apartments will be cut from 18 percent to eight percent, noting that the government is trying to resolve housing problems because it believes that it is a key issue.

He said that this problem will be resolved through a lower VAT rate on apartments and through subsidised home loans. He expressed hope that the parliament will approve the changed rates by the end of next month.

Dinkic also said that there is no reason for the state to rush with selling its stake in mobile telephone operator Mobtel because it expects to improve its ownership share once the dispute with BK Trade is resolved.

Furthermore, Dinkic pointed out that the current budget surplus is another reason not to hurry the sale of the government’s Mobtel stake and that even if it was sold, an agreement with International Monetary Fund (IMF) representatives forbids that money to be spent.

While the state’s sole interest is to get as much as it can when it eventually sells its stake in Mobtel, Dinkic said that it must first assess how much longer the ongoing arbitration proceedings with BK Group, the co-owner of Mobtel, will last.

He said that when the time comes, the state will sell its share of Mobtel to the best bidder in a tender.