The municipality of Pljevlja will significantly reduce the property tax for owners of buildings and land in rural areas.
In the Draft Decision, which needs to be confirmed by the local parliament, it is stated that through the reduction of the location coefficient in the zone outside the border of the DUP, there will be a reduction of taxes by 75 percent for facilities in rural areas.
On the basis of real estate tax for buildings in rural areas, the Municipality has calculated about 110.000 euros annually.
"Amendments to the Decision will directly affect the significant financial relief of taxpayers based on land tax, which will in no way negatively affect the further realization of the collection level as from the previous period, which ranged from 110.000 to 180.000 euros.
This reduction, according to the local administration, will potentially affect the promotion of construction in an area that is not in the zone of urban development.
By changing the coefficients for determining the market value of land according to quality and class, the total annual calculation will decrease by 49,55 percent, that is, from EUR 417,700 to EUR 218.
"The financial effects of changes in these coefficients will be felt by all taxpayers, regardless of whether they are registered agricultural producers or not. The financial effects on each individual taxpayer will be different depending on the structure and area of their property-land. The reduction will be between 30 and 60 percent. An additional financial effect in terms of relieving the tax liability of taxpayers is that for all registered agricultural producers in the territory of the municipality of Pljevlja, the tax rate of 0,25 percent will be reduced by 90 percent in the manner prescribed by law," says the president of the municipality of Pljevlja. Igor Golubovic in the explanation of the decision.
According to the local self-government, the reduction of real estate taxes creates potential conditions for an increase in the number of registered agricultural producers, an increase in agricultural products, the valorization of natural resources, and an increase in market competition.
In the Municipality, they expect that the proposed changes will lead to a higher collection based on land tax, that is, the collection percentage compared to the cut-off.
According to the existing decision on real estate tax, the total annual liability for real estate tax in rural areas ranged from 370.000 to 420.000 euros in the last five years.
The total annual number of tax rulings for land is around 20.000, and the largest share in the calculation is meadows 43, 67 percent.
The territory of the municipality of Pljevlja covers over 13 percent of the agricultural area and about 15 percent of the arable agricultural land of Montenegro. Of the total area of the Municipality of Pljevlja, agricultural areas occupy 51 percent, with mountain pastures and meadows dominating.
In the structure of agricultural land in the municipality of Pljevlja, the largest part - 86 percent is occupied by perennial meadows and pastures, while arable land, gardens and orchards make up only 14 percent of the total agricultural land.
According to the data of the Ministry of Agriculture, Forestry and Water Management in the municipality of Pljevlja in the middle of last year, 1.473 agricultural farms were registered, which is over 1.100 more than in 2016.
This year, that number ranges between 1.700 and 1.800, of which 70 percent are engaged in cattle breeding, and 23 percent in arable production.
By reducing taxes on real estate in rural areas, the Municipality wants to stop the trend of decreasing population in rural areas, population migration from rural areas and enable further development and maintenance of rural areas.
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