Bussines environment
BOOSTING PROFITS WITH FAVORABLE TAX SYSTEM
By choosing to locate in Vojvodina, foreign investors enjoy the benefits of a highly competitive and advantageous tax system, essential for boosting company profits.
In addition, favorable business and investment climate conditions contribute to a proven record of successful FDI attraction.
In general, Serbia’s tax regime is highly conductive to doing business.
Corporate profit tax is the lowest in the region, while VAT, salary tax and social insurance contributions are among the most competitive in Central and Eastern Europe.
| Standard VAT Rate 20% | Corporate Profit Tax Rate 15% | Salary Tax Rate 10% |
|---|
Social Insurance Contributions
Pension and disability contributions are 14% for employees and 10% for employers.
Health insurance contributions amount to 5.15% for both employees and employers.
Employees contribute 0.75% towards unemployment insurance.
Annual income tax rates range from 10% to 15%, with an additional 20% tax on other income.
SALARY TAX RATE
| Serbia | 10% |
| Romania | 10% |
| Czech Republic | 15-23% |
| Slovenia | 16-45% |
| Poland | 12-32% |
| Slovakia | 19-25% |
CORPORATE PROFIT TAX RATE
| Serbia | 15% |
| Poland | 19% |
| Romania | 16% |
| Czech Republic | 19% |
| Slovenia | 19% |
| Slovakia | 15-25% |
STANDARD VAT RATE
| Romania | 19% |
| Serbia | 20% |
| Slovakia | 20% |
| Czech Republic | 21% |
| Slovenia | 22% |
| Poland | 23% |
LABOR MARKET
One of Vojvodina’s most significant values is an excellent balance between the quality of work, costs, and productivity. Foreign investors who already operate here emphasize that this balance provides a good foundation for successful business in Vojvodina, leading to higher profitability without compromising the existing quality standards of companies.
In Vojvodina, there are 143 registered secondary schools, 121 in state ownership and 22 in private ownership. The teaching occurs in Serbian, Hungarian, Rusyn, Slovak, Romanian, and Croatian languages.
Higher education is well-developed in Vojvodina, with three universities (one state – 14 faculties, two private – nine faculties). The state university includes the internationally recognized Faculty of Technical Sciences (28 profiles in undergraduate and 33 profiles in master academic studies).
Vojvodina has 53,632 enrolled students in 2022/2023. Most candidates who speak foreign languages speak English and German, but Russian, French, Spanish, and Italian are also instructed in foreign languages.
WORKFORCE STRUCTURE - Average salary in Vojvodina 2023
| % | EUR | |
|---|---|---|
| Net salary (EUR) | 692.7 | |
| Personal Income tax | 10 | 77.7 |
| Contributions (employee) | 19.9 | 191.4 |
| Gross salary | 961.7 | |
| Contributions (employer) | 15.15 | 145.10 |
TOTAL COST | 1107.4 |
Source: Statistical Office of the Republic of Serbia
AVERAGE MONTHLY SALARIES BY COUNTRIES
CEE Countries | Minimum gross salary (EUR) in 2023 | Average monthly gross salary (EUR) in 2023 |
|---|---|---|
| Serbia | 461 | 1,011 |
| Romania | 604 | 1,418 |
| Hungary | 624 | 1, 496 |
Czech Republic | 729 | 1,806 |
| Slovakia | 700 | 1,430 |
| Croatia | 700 | 1,584 |
| Poland | 811 | 1,575 |
| Slovenia | 1,203 | 2,221 |
Source: Eurostat
Company Registration
The registration of all types of companies is under the Serbian Business Registers Agency jurisdiction. Since May 17, 2023, the submission of paper applications for establishing a business entity, such as a General Partnership, Limited Partnership, Limited Liability Company, and Joint-Stock Company, is no longer allowed. Applications can only be submitted electronically through a dedicated user application.
Some legal forms, like cooperatives and cooperative unions, public enterprises, branches, and representative offices of foreign companies, are exempt from this rule and can still be established on paper.
The registration process typically takes five to 10 days.
Required documents include:
- A unique registration application
- Prescribed documentation (in original, certified copy, or certified photocopy)
- Proof of payment of the registration fee
The one-stop registration system allows businesses to obtain:
- a statistical/matrix number from the Statistical Office
- a tax identification number (TIN) from the Tax Administration
- VAT registration
- A confirmation of the submitted application for mandatory social insurance simultaneously with the registration decision.
For more information and instructions on establishing business entities, visit the Serbian Business Registers Agency website.
OPERATIONAL COST
- 500 Logistics spaces (average cost)
- 600 – 800 Industrial facilities (average cost)
- 1,000 – 1,200 Business premises (average cost)
- Lease of industrial space (average cost):
- Old build: 3 – 5 EUR/m²
- New build: 5 – 10 EUR/m²
- Built-to-lease option
- Lease with purchase option
Free Trade Agreements
EUROPEAN UNION (EU) (505 million population)
The agreement enables customs-free Export of all products bearing the Serbian origin label, except wine and baby beef. Additionally, it abolishes customs duties and quantitative restrictions on the import of Serbian textile products, guaranteeing the maintenance of the same policies in the future. In agriculture, the agreement includes exemption or reduction of customs duties, depending on the Annex or Protocol of the SAA in which the product is listed.
TURKEY (72 million population)
CEFTA (30 million population)
EFTA (13 million population)
CHINA
JAPAN (125 million population)
The GSP program between Japan and Serbia provides Serbian exporters with reduced tariffs or duty-free access to the Japanese market for certain products, such as textiles, clothing, fruits, and frozen foods. This preferential treatment supports Serbian industries, like the textile and food processing sectors, by expanding their market presence in Japan.
Russia (144.2 million population)
Kazakhstan (19.62 million population)
Belarus (9.228 million population)
EGYPT (111 million population)
By eliminating tariffs on most products, the agreement will lead to an increase in trade volume and the competitiveness of Serbian products in the large Egyptian market, which has over 100 million consumers. The Free Trade Agreement stipulates that 87.5% of agricultural and 30.5% of industrial products will be fully liberalized.
USA (317 million population)
Foreign trade with the United States is primarily conducted under the Generalized System of Preferences (GSP). An agreement has been reached allowing duty-free entry for over 4,650 products, including most manufactured and semi-manufactured goods and selected agricultural and primary industrial products. Excluded products mainly fall into textiles, leather goods, and footwear.
AUSTRALIA (27 million population)
Under the Generalized System of Preferences (GSP), Australia grants Serbia preferential tariff rates on a range of products, such as fruits, vegetables, wine, and industrial components, facilitating access to the Australian market. This arrangement aims to boost Serbian exports, particularly in sectors like agriculture, food processing, and machinery manufacturing, by making Serbian goods more competitive. As a result, it strengthens trade relations and economic ties between Australia and Serbia.
FREE ZONES
FREE ZONES IN VOJVODINA
Free zones in Vojvodina offer favorable conditions for business, especially for companies engaged in the manufacturing, storing, and processing of goods intended for export.
These zones allow exemption from customs duties and value-added tax (VAT) for the import of raw materials, semi-finished products, and equipment needed for export-oriented production.
Advantages of doing business in the free zone regime:
- Fiscal benefits
- Customs benefits
- Financial benefits
- Benefits of local self-government
- Efficient Free Zone Administration (One Stop Shop)
Free Zones in Vojvodina:
- Free Zone Novi Sad
- Free Zone Subotica
- Free Zone Apatin
- Free Zone Zrenjanin
- Kikinda (Free Zone Subotica)
- Ruma (Free Zone Sabac)
- Senta (Free Zone Subotica)
- Indjija (Free Zone Sabac)
- Nova Pazova (Free Zone Belgrade)
- Pancevo (Free Zone Belgrade)
