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PRESS RELEASE April 24, 2019

Creating Better Public Services and a Modern Tax System in Serbia, with Help from World Bank

WASHINGTON, April 24, 2019 – Two new projects, Enabling Digital Governance Project and Tax Administration Modernization Project, will provide faster, more transparent, and less costly public services for Serbian citizens, and will enable the Government of Serbia to improve revenue collection while making the tax system more efficient and easier for citizens to deal with, and reduce corruption.

These two projects, worth $102 million, were approved today by the World Bank Board of Directors.

The $50 million Enabling Digital Governance Project will finance registration of all public services in Serbia. Thirty services important for everyday life of the citizens will be completely digitalized by the end of the project. Another 120 services that affect the lives of citizens the most will be thoroughly reviewed and mapped as to be made ready for full digitalization which the Government could do in the future.

“International and regional experience shows the benefits of digitalization in simplifying processes, increasing efficiency, and lowering the overall cost of services to the public,” says Stephen Ndegwa, the World Bank Country Manager for Serbia. “The benefits of such reforms are significant for lessening opportunities for corruption and for encouraging economic investments. For example, over the last decade, many countries have reduced the time and cost for accessing services by between 25 and 50 percent, partly contributing to increased private investment and job creation.”

At the heart of the $52 million Tax Administration Modernization Project is improving efficiency of revenue collection and making it easier for citizens and firms to pay their taxes, something the World Bank’s Doing Business annual report consistently shows Serbia lagging in. The Project will finance improvements of the legal framework aimed at supporting recognition of digital documents for judicial purposes; document retention and records management; and information exchange between Serbian Tax Administration, other government agencies, and third parties. It should likewise develop procedures for automatic exchange of information with EU member states and help align the existing laws with EU standards.

Also, the Project will support improvements in business processes such as the automatization of the process of issuance of tax clearance certificates and offering it as an online taxpayer service, which will lead to the reduction of transaction costs for taxpayers in obtaining these certificates. Finally, the Project will finance significant improvements in hardware and software capabilities of Serbian Tax Administration which would enable improvements in service delivery.

“Modernizing Serbia’s tax system should ultimately contribute to lowering the compliance burden for taxpayers by helping reduce time to comply with taxes which will improve incentives for investment and business growth,” says Ndegwa. “It will also help the Government of Serbia improve tax collection.”



Kym Smithies
Vesna Kostic