A closer instruction for the enforcement of these rules which might have solved the ambiguities should have been created by the Ministry authorized for finance. However, those statutory laws have not been created yet, although the changes to this part of the Law are officially applied from March 1, 2020.
The biggest discrepancy noticed is the requirement to have a concluded agreement for an indefinite time with the newly settled taxpayer, which completely contrasts the regulations that determine the residence and employment of foreigners in the Republic of Serbia.
Besides, we would like to point out the fact that there is an uncertainty in terms of requirements about the newly settled taxpayer who has not predominantly resided in the Republic of Serbia 24 months prior to the conclusion of the employment agreement. It is not certain nor known what period i.e. what number of months the tax administration will (not) consider as predominant residence. In any case, for a definite temporal period before the conclusion of the employment agreement, the foreigner has to reside on the territory of the Republic of Serbia, having in mind that they have to apply for the temporary residence and work permit, and wait for the decision of the authorities to their requests. This period, according to our understanding, should not be considered “predominant residence”.
Zunic Law Firm has contacted the Commerce Chamber of Serbia as well as the tax administration several times this year, in order to ask how to apply these provisions to foreign citizens, i.e. non-residents. We believe that this question is crucial, since in accordance with the regulations of foreign employment, foreigners cannot be employed for an indefinite time, but only in the duration of the temporary residence permit.
However, none of the aforementioned institutions could give us a specific answer, except that the rulebook, which should present us with a detailed way of actualization of the stipulated reliefs, has not been enforced yet.
Still, what was confirmed up till now from the Commerce Chamber of Serbia is that the subject provisions and benefits refer to foreigners, newly settled parties, as well, disregarding the discrepancy of the concerned Laws.
Therefore, until future enactments of necessary changes or statutory laws, which will prescribe the rules of application of beneficial standards, we can only rely on the existing rules to help out those who are entitled to this right.