Starting from the fact that Serbia's current tax system was shaped by the 2001 reform in a markedly different economic and social context, as well as from relevant theoretical and empirical insights and the experiences of other European countries, it can be concluded that there is substantial scope for its improvement in support of the sustainable development of Serbian economy and society. A comprehensive tax reform should be oriented toward three key objectives: fostering dynamic economic growth through investment, innovation, and exports; accelerating the green transition; and reducing economic inequalities. These objectives can be achieved through a revenue-neutral reform that entails a significant reduction in the tax burden on labor, an increase in environmental taxes to align with EU policies and mitigate the effects of the CBAM, and an adjustment of consumption taxes in the residual amount necessary to preserve fiscal neutrality. Such a reform would stimulate exports and investment, enhance both horizontal and vertical equity of the tax system, and reduce inequalities, with an additional contribution from reforming inheritance and gift taxation. In parallel, a parametric reform of corporate income taxation, combined with the introduction of incentives for investment in advanced and green technologies - particularly in the small and medium-sized enterprise sector - could contribute to the growth of domestic investment and to long-term technological and environmental progress, provided that improvements in the business environment and the institutional framework are implemented simultaneously. This paper presents estimates and analyses of the economic effects of one modality of such a tax reform.
Ranđelović et al. (Thu,) studied this question.