Along with the higher minimum wage, there will also be relief for employers

The minimum wage in Montenegro will be increased from 222 to 250 euros from July 1 this year, and until then negotiations will be held with employers on the reduction of wage taxes or the introduction of a non-taxable part of wages, "Vijesti" in the ruling coalition has learned.

Yesterday, the representatives of all parliamentary clubs of the ruling coalition submitted to the Parliament a proposal to amend the Labor Law, which defines that the minimum wage cannot be less than 250 euros.

The minimum wage is now 222 euros.

Amounts and loads

On the minimum net salary of 222 euros, the employer pays another 142 euros in various duties, i.e. the total minimum salary costs him 364 euros.

If the amount of the minimum was increased to 250 euros, the employer would pay another 160 euros in fees, or a total of 410 euros.

In fact - on the amount of the predicted increase in the net minimum wage of 28 euros, the employer would pay another 18 euros in taxes or 46 euros in total.

The Social Council was not previously consulted on this bill. When the minimum wage was increased for the last time in July 2019, social partners agreed in principle to continue its increase in the following years with a simultaneous reduction in wage taxes.

Then health insurance contributions were reduced by two percent of gross earnings.

Montenegro is the only one that does not have a tax-free part of the salary

Montenegro is the only one in the region, and in Europe, that does not have a tax-free portion of earnings. Employers have been asking for the introduction of this relief for years, but the previous government refused it, while, according to "Vijesti" information, the new government is ready to discuss it.

The non-taxable part of earnings in Serbia now amounts to 18.300 dinars or about 155 euros, while in Bosnia and Herzegovina it is 260 euros.

According to data from the end of 2019, 14 employees were insured for the minimum wage, and another 40 for the amount between 222 and 250 euros.

The MPs who signed this proposal state in their explanation that the current amount of the minimum wage makes up only a third of the minimum consumer basket.

Higher old-age benefits

"We are convinced that the proposed increase will not significantly increase costs in either the private or the public sector. The increase in the amount of the minimum wage will have the effect of a significant increase in budget revenues based on the collection of taxes, surcharges and contributions paid on wages," the explanation stated.

Deputies of the ruling majority yesterday proposed changes that increase the old-age benefits for agricultural producers over 60 for women and 65 for men from 50 to 70 percent of the minimum pension.

This would mean an increase from 72 to 102 euros.

About three thousand citizens receive this compensation.

Children's allowance for all children up to six years old, free textbooks

The members of the majority sent the Assembly a proposal to amend the law, according to which all children up to the age of six will receive child allowance in the amount of 30 euros, while children in a state of material and other needs will be increased to the amounts of 44 to 60 euros until they turn 18.

The Minister of Finance and Social Welfare, Milojko Spajić, announced in mid-December that the department's intention is to solve child poverty through the introduction of child allowance.

The head of the "Crno na bijelo" parliamentary club and the vice-president of the Citizens' Movement URA, Miloš Konatar, said that the decision to award child allowance for all children in Montenegro was the result of an agreement between the URA, Democratic Montenegro, the Democratic Front, the Socialist People's Party, as well as the Ministry of Finance and of social welfare and the Government.

Amendments to the law have also been proposed, which will enable every elementary school student to have the right to free textbooks from the next school year.

It was stated that there are 68.506 elementary school students in Montenegro, so the proponents estimate that this type of aid will total around four million euros.