Local businesses: We're taking advantage of the tax.

The government of Kosovo's customs duty decision, initially 10 percent and then 100 percent, has been in effect since November last year.

Arben Tersnjak, company manager “Liri” in Prizren, which deals with food products, tells Radio Free Europe that since the introduction of this tax, this company has had increased production to 7 per cent.

After the tax was issued we had a good sale increase, demand for production increased, we had new employment. Since the tax is being imposed, we have employed 40 workers and this trend of increased production capacities and increased new production lines is continuing”, Tersnjak says.

Trsnjak points out that the tax has not emptied the Kosovo market with products of Serbia and Bosnia, as products from these countries are continuing to be market, but that, according to him, citizens in some form have been conscious of consuming local products in order to strengthen the state economy.

Business representatives had stressed that goods from Serbia are entering the Kosovo market in alternative form or through smuggling, though they had denied Kosovo Customs officials.

Production growth and employment have also taken place in the meat industry “Meka”. Burim Piraj, owner of this company in a conversation for Radio Free Europe, says they have marked increased production capacities.

We've had only one impact on the tax until in other products we haven't had a direct impact since there are other products we produce that haven't been imported from Serbia and Bosnia and Herzegovina, but we've had an increase in production and that this production has been due to the rise of economic patriotism and we've been forced to employ new workers. The product growth trend is continuing”, says Piraj.

On the other hand, Haki Shatri, Kosovo Prime Minister Ramush Haradinaj's economics adviser, tells Radio Free Europe that during meetings Kosovo's prime minister has had with economic associations in the country, it is stressed that the tax has had a positive effect on producers.

“Tax settlement has positively affected local production growth. Many companies producing products which, to a large extent before the tax, have been imported from Serbia now those companies have expanded the production range and increased the number of employees and the sale has increased, says Shatri.

The companies contacted by Radio Free Europe say that in addition to the 100 percent impact tax, there have been administrative guidelines of the Ministry of Trade and Industry that impose all business subjects in Kosovo placing flags in stores to show the location of the origin of products they have for sale.

Arben Tersnjaku, company manager “Liri” in Prizren, says that if consumers were to impose tax removal, they would continue to consume local products.

Right after the tax was issued, the flaging went into effect. Before setting flags, most consumers are not interested in the background of products, but after setting flags, consumers go carefully and then select the product, it has had a very great effect. I think that even now, even if the tax removal occurs, we believe that Kosovo consumers will continue to buy Kosovo products and boycott the products of Serbia and Bosnia and Herzegovina”, Trsnjak says.

While local producers say they have benefited from taxing, on the political plan it had effects, especially in relation to dialogue with Serbia, for which the official Pristina has been reproved by the US and the EU.

The 100 per cent tax settlement on the other side has blocked the dialogue mediated by the European Union, between Kosovo and Serbia.

The European Union and the United States of America are constantly asking the official Pristina to suspend this tax so that the continued opportunity of dialogue can be given.

But, the Kosovo government, at least so far, has not backed down on the 100 per cent fee decision, which continues to remain in force.