Government Against LDK Initiative to Change Three Laws

The ruling coalition has rejected the LDK's legal initiative for changes to three laws, which concern fiscal reform 2, initiated by the former government Mustafa, but left in half due to the distribution of the Assembly.

The LDK initiative was the change and completion of the Law on Personal Revenue Taxation, the Law for Taxation in corporate Revenues, and the Law on Additional Taxation.

The head of the LDK parliamentary group, Avdullah Hoti, said that in 2017 the second fiscal package was approved, where 22 fiscal measures were prepared, and within these measures are included complementing and changing under these three basic laws.

The LDK parliamentary group has undertaken these three legal initiatives to implement the 13th and 14th fiscal package measures. More specifically, in the corporate income law, tax is meant to be kept at the source for agricultural product collectors, which has so far been 3 percent, and to regulate the way insurance companies are taxed, which so far have paid 5 percent of gross income tax, while with this bill they will now pass on regular taxation like any other company in Kosovo. The VAT law is designed to recognise the VAT issue for international passenger transport companies and T implementation V The amount for domestic gold trade, so the VAT can only be applied to the increased value of processed 87x1>, Hoti said.

He added that compliance with these laws comes after results provided fiscal reform 1.

This law has benefited businesses, and during 2016 it is estimated that there are 47m euros that have benefited private businesses in Kosovo. Large businesses have grown in Kosovo as a result of this package by 12 percent. So the number of large companies has increased from 221 to 248, and employment has also increased by about 5 thousand in these companies. Citizens have also benefited, who have benefited about 24m euros from the TV cut US out of 16 to 8 percent for a number of goods and services”, Hoti said.

Vetevendosje Movement Chairman Albin Kurti said the former government is now trying to correct itself.

It is known that the tax in the source when it comes to domestic production cannot be placed on any subject that conducts part of the process, because it is eventually charged with the price. Even though production has certain cycles until the market, and we know that these cycles are performed by certain people or companies, but in the end the same product remains, the product does not grow on the road. As a practical example, vegetables or eggs cannot be sold without a ambalage, a cardboard box, whether we supply at the source both what produces and what produces chemical fertilizer, even irrigation, and finally what sells ambalages, vegetables, or eggs, or will be sold under cost without profit, or they will have a high price compared with import and will not be competitive on the market<1>, Kurti said.

This LDK initiative met in opposition to the government and deputies of the ruling coalition. Finance Minister Bedri Hamza said the ministry he heads has prepared the drafts of these laws, and have been submitted to the IMF and released to public discussion. He has called for the government's laws, which are drafted in line with international standards, to be expected.

When we are fiscal policies, we should also consider the fiscal policies of countries in the region. Fiscal policies are just a segment that contribute to the environment of doing business, which contribute to attracting foreign direct investment, are not a trivial element. If we look at corporate income rates, it turns out that all countries in the region have this rate, actually at 9 and 10 percent. If we raise the tax rate to profit and we look at the disadvantages we have like Kosovo and we create an additional burden then we will not create an environment for attracting direct investment. Approximately, Kosovo has policies similar to the countries in the region, it does not mean it is unique, but has the same”, he said.

PDK MP Safete Hadrigjina has demanded that these bills not be adopted, saying they are a bad message for foreign investors.

“parliamentary group The PDK supports the government's recommendation not to adopt these bills, because adopting them is a bad message for businesses and investors. If every month we go into law enforcement, then this will be a generally burden to the tax system for the Tax Administration and cause a judicial uncertainty in foreign investors and are challenging to local businesses”, Hadrgjaj said.

Even the AAK parliamentary group's chief, Ahmet Isufi, quickly praised the LDK action, expressing itself against it.

And since these three bills are in the government agenda, then I don't know why there's a need to be started to duplicate our work. We also have a lot of other jobs in the Assembly, so I consider it should be expected to bring Government to the Assembly, then complete the change of these laws, which will then be implemented”, Isuffie said.

Power was joined by the opposition PSD party. The party's chief of deputies, Dardan Sejdiu, said they oppose the problem as it is not essentially being addressed, but only exercising.

The “given that the Government has already sent these three laws to the IMF for review, and given that there has been a discussion about not having this kind of discussion, The PSD will vote against, starting only by the simple promise that we are doing small exercise in the tax system without addressing the problem essentially. The problem is basically not the fiscal system, nor the laws, but the ones you're writing or trying to write. The problem in essence is the system we have established in this country now of 18 years”, Sejdiu said.

Even the Social Democrat Initiative has not supported the fulfillment of these three laws.