“Moj ДДВ” Is a Partially Fulfilled Election Promise of SDSM

Фото: Влада на РСМ

A revision of a promise given by SDSM in their election program – 15% return of value-added tax paid by citizens on every purchase of products and services – shows that this promise is partially fulfilled.

A revision of a promise given by SDSM in their election program – 15% return of value-added tax paid by citizens on every purchase of products and services – shows that this promise is partially fulfilled.

Every citizen (i.e every final consumer) will be refunded 15% of the VAT paid, excluding luxury goods tax. The goal is, on one hand, to provide more income for each family, and, on the other hand, to introduce a strong initiative by citizens to insist on the issuance of a fiscal bill, with which each person would play the role of a tax inspector, thereby improving the payment of VAT…

… With this measure, we will provide an annual return of 8 billion denars to the citizens of the Republic of Macedonia;…

[Source: Предизборна програма на СДСМ, стр.49  – date: December 2016]

EXPLANATION:

In the ruling party’s 2016 election platform, the promise that 15% of the VAT (value-added-tax), paid by citizens will be refunded, is emphasized in several places. The measure and the expectations are stated in detail on pages 49 and 50 of the election platform. Among other things, on page 50 it is decisively stated:

An annual return of 8 billion denars to the citizens of the Republic of Macedonia;

The measure started on 1 July 2019, when the implementation of the law adopted for that purpose begun. It was announced ten days earlier, when at a joint press conference Prime Minister Zoran Zaev, then Finance Minister Dragan Tevdovski and IRS Director Sanja Lukarevska, announced and explained the measure.

Then Finance Minister Tevdovski pointed out that the Government expects the state to repay a maximum of 50 million euros a year to the citizens, and that the return per person is limited to 1,800 denars for three months, or a maximum of 28,800 denars per year for a four-member household (around minute 15 in the video from the press conference).

Both the government and the IRS have repeatedly emphasized that the measure is excellent and that it has contributed to increased fiscal receipts. This leads to increased tax discipline, citizens are massively scanning their fiscal bills and the state will soon return the money (December). VAT revenues for July and August were up 10% compared to the same period in 2018, and within two months citizens should receive back 2 million euros.

I am very pleased with the realization of “Mој ДДВ” so far. Since the beginning of “Mој ДДВ” on July 1, and by the end of August we have already recorded 15 million scanned fiscal bills, turnover exceeded 7.6 billion denars, total VAT amounted to just over 800 million denars and 15% returns to citizens. That amounts to 125 million denars, or 2 million euros, said the director of IRS, Lukarevska on 2 September 2019.

If the promise is analyzed in detail, it is a fact that the measure has been implemented (albeit with great delay because it was promised in the first 6 months i.e. Plan 180 – p. 209). A special law introduced VAT refunds, the financial discipline has obviously been strengthened, and VAT revenues have increased.

But it is also a fact that in the program it is stated that SDSM planned to return 8 billion denars a year to the citizens or about 130 million euros, and when the measure was presented by Tevdovski it was said that a maximum return of about 50 million euros is expected. This means that the Government and the institutions have reduced the maximum amount to be returned by about 80 million euros from the initial plans and introduced restrictions that set the maximum amount for an individual at 1.800 denars per month.

If judged again, according to the first two months of the measure, it would not be a surprise if the total return in one year does not exceed the amount of about 15 million euros.

Therefore, due to the above-mentioned arguments, we believe that this promise of SDSM can be deemed as partially fulfilled.

 

SOURCES:

 

Analyzed by: Teo Blazevski

 

 

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