Serbia Scraps 20 Percent Cap on Fuel Excise Cuts

Three bills amending Serbia’s finance laws were filed in the National Assembly on August 8, and the most concrete of them removes the cap on temporary cuts to excise duties on oil derivatives. The bills amend the Public Debt Law, the Excise Law and the Electronic Invoicing Law, all proposed by the Government of Serbia.

All three are now on the list of acts pending before parliament, in the convocation that began August 1, 2022, alongside dozens of other tax and budget laws awaiting a session.

What scrapping the 20 percent cap means

Under the excise law currently in force, the Government can temporarily cut excise duties on oil derivatives when a rise in world crude prices threatens the country’s macroeconomic stability. The reduction can match the amount by which derivative prices have risen, but under the current text it cannot exceed 20 percent of the last published excise amounts.

The proposed amendment deletes that limit. If parliament adopts the bill, the upper cap disappears, and the scale of any intervention at the pump will depend solely on the Government’s decision at the moment of a market disruption. The same bill also regulates how dinar excise amounts on derivatives are adjusted for annual inflation.

State guarantees get a fee

The amendments to the Public Debt Law touch Articles 16 and 18 of the existing text, which govern the authority to issue guarantees and the conditions under which Serbia grants them. The new element is a fee charged for issuing a guarantee.

The proposer’s explanatory note says the change is needed because of Serbia’s EU accession process, chiefly to align with state aid control rules. It rests on an action plan with deadlines for bringing non-compliant state aid schemes into line, adopted by the Government on June 25, 2026, and is also tied to the Reform Agenda for the business environment and private sector development. The change is set to take effect January 1, 2027.

There is a practical point the explanatory note does not spell out directly. A state guarantee that used to be issued free of charge was itself a benefit to the loan recipient, and by attaching a fee, that benefit now carries a price, which is exactly what state aid control rules require. The list of pending acts shows the scale involved: among the bills awaiting action is a guarantee for the Postal Savings Bank covering Transnafta’s obligations under a loan for building the Serbia-Hungary oil pipeline.

Exports and farm produce purchases join the e-invoicing system

The third bill brings export data into the electronic invoicing system along with a new method for recording value added tax, laying the groundwork for a preliminary VAT return.

The deadlines are staggered. Electronic recording of purchases of agricultural and forestry products and agricultural services from farmers becomes mandatory from July 1, 2027, and will be recorded in aggregate. From the same date, access to export and shipment data will run through a list of customs declarations. The rest of the law takes effect January 1, 2027.

The e-invoicing system has been running since May 1, 2022, when the first obligations took effect, and it has been expanded several times since, most recently with the mandatory electronic recording of input tax.

Part of a broader tax package

These three bills are not arriving on their own. We previously reported that the Government adopted a package of ten laws alongside three billion dinars in business support, and a day before these bills, on August 7, parliament also received a bill amending the Law on Special Conditions for Registering Property Rights.

Also pending, alongside them, are amendments to the Value Added Tax Law, the Fiscalization Law, the Budget System Law, the Law on Tax Procedure and Tax Administration, the Electronic Waybills Law and the Tobacco Law, as well as the final account of the 2025 budget. Lawmakers have yet to debate any of it, and the date tying it all together is January 1, 2027, when most of the new rules take effect.