Incentives for Startups Finally From October
Government of the Republic of Serbia has finally announced that start-up businesses will be freed from taxes and contributions in the first year of their operation, after long-term convincing by the expert public and business association that started in 2010.
This is a good news, not only for the young people who decide to be their own boss, or for hundreds of thousands of unemployed people who have an opportunity to start their own businesses, but also for the consultants gathered in BSN, who were among the first to do analysis and present these as a necessary measure to the public.
Average founding capital of a small enterprise in Serbia is only 5140 EUR, and the expenses of taxes and social security contributions, as well as increased accounting and banking transfer expenses „eat up“ almost 1600-1800 EUR in the first year of business operations. Companies founded in the province and the underdeveloped regions are especially sensitive, as their founding capital is only between 1000 and 3000 EUR, and have even greater difficulties to survive the first three years. This, together with low purchasing power of the general population and competition already present in the market, is the main reason why over 42% of companies in Serbia shuts down in the first three years of their founding.
If Serbian Government really implements this announced decision by October, it will also reduce the brain drain among young people who are disappointed with low wages or unable to find employment and are leaving Serbia. According to the information of European Migration Network, Serbia is, together with Albania, Kosovo and Bosnia and Herzegovina an unfortunate leader in people up to the age of 35 leaving the country. Even though the state doesn’t follow this statistics, different sources estimate that between 25,000 and 30,000 young people leave Serbia annually searching for employment in the EU Member States and North America, but youth is also leaving for Africa, Middle East, Australia and Japan…
For this reason, incentives for startups mean at least a small chance more for some of them to still decide to remain and become entrepreneurs in their own country.