Administration of the mayor of Tivat Željko Komnenović (The People Win) has prepared a draft Budget Decision for 2026, which should soon be before the councilors in the local parliament, as the President of the Municipal Assembly Miljan Marković (NSD) scheduled a session for January 23rd with the proposed Budget Decision for this year as the only item on the agenda.
The draft decision, which "Vijesti" had access to, states that the city treasury will have a total of 34.107.100 euros at its disposal this year, which is 0,7 percent more than the budget in 2025.
Due to the increasingly pronounced disagreements between some of the constituents of the ruling coalition in Tivat - the civic list Narod pobjeđuju (People Wins) on the one hand and the New Serbian Democracy (NSD) on the other, the session of the local parliament at which the budget for 2026 was supposed to be adopted has not yet been held. Therefore, the city is currently operating in a temporary funding regime because the budget for this year was not adopted when it was supposed to be according to the legal deadlines - by the end of last year.
The budget's original revenues, as proposed, will amount to 25,78 million euros, while eight million euros of unspent funds will be transferred from last year's budget to the 2026 budget.
As for current budget spending, the largest amount, 9,38 million euros, will be directed to transfers to budget users (institutions, individuals, the public and NGO sectors, or for grants to local public enterprises and institutions), while the operating costs of the local administration of Tivat itself in the form of allocations for salaries of employees in the municipal administration, or allocations for material expenditures and services will amount to 7,88 million euros. It is interesting that the item "other expenditures", which is planned in the amount of 1,78 million euros, records an increase of as much as 89,5 percent compared to last year's budget.
“The reason for this increase is the necessity of reserving funds for the refund of overpaid real estate tax, due to the cumulative effect of a series of decisions of the Constitutional Court that abolished the legal and by-law bases for taxation. Specifically, the financial risk to the Municipality’s budget arose due to the following circumstances: the repeal of the Regulation on the Methodology for Determining the Market Value of Real Estate, which retroactively called into question the legal basis for calculating the tax base in previous years; the repeal of Article 12 of the Decision on Real Estate Tax of the Municipality of Tivat, which abolished the possibility of applying different rates for legal and natural persons; the repeal of the legal basis for taxation of undeveloped construction land at rates from 0,3 to 5 percent, as well as the most recent abolition of the category of “buildings under construction” as a subject of taxation; and the adoption of a constitutional appeal in the case related to the taxpayer “Ostrvo Sveti Marko”, which overturned the Supreme Court’s judgment. This removed the legal basis that the Municipality had previously relied on when rejecting the request for a retrial, which opened the way for the final and final tax "Approves the repetition of procedures from previous years and orders the return of funds," it says in the explanation of the drastic increase in "other expenses."
It is noted that, given that these decisions of the Constitutional Court “were made without transitional solutions that would protect the legal certainty of previous final decisions, the Municipality of Tivat is facing a large number of tax refund requests, primarily from large legal entities.”
In addition to the amount of previously collected property tax that must be refunded, this amount also includes default interest, as well as the costs of court and administrative proceedings.
Total expenditures will amount to 32 million and 16.100 euros by the end of 2026, of which current budget spending will be 17,52 million, capital expenditures 14,5 million, and debt repayment 2,09 million euros.
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