Podgorica, (MINA-BUSINESS) – Minister of Finance Novica Vukovic said that the new Value Added Tax (VAT) Bill aims to provide a more comprehensive regulation of all key elements of Montenegro's VAT system in line with European standards.

Presenting the draft legislation in Parliament, Vukovic said the current VAT Law, adopted in 2002, has been gradually aligned with EU regulations over the years, but still contains provisions that are not fully consistent with Council Directive 2006/112/EC and its subsequent amendments. 

“Given that EU membership is Montenegro’s strategic goal, as well as the need to modernize and simplify the system in response to the development of the digital economy and the growth of cross-border trade, it has been assessed that the existing framework is no longer sufficient and that an entirely new law is necessary,” Vukovic said.

Implementation of the law will require adjustments to the business processes and IT infrastructure of the Tax Administration.

Vukovic added that the proposed legislation brings Montenegro one step closer to the provisional closure of Chapter 16 – Taxation in its EU accession negotiations.