Digital nomads leave a third of the income in the state

One of the goals is to have 2023 digital nomads in Montenegro in 250, and 1.000 two years later, provided for in the draft Program that is currently under public discussion. In just a few months, they accepted about 1.000 applications from 25 countries in Croatia. Next year, the Law on Aliens and the Law on Personal Income Tax will have to be amended

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Comparative experiences for digital nomads - Draft Program for attracting digital nomads MJU, Photo: Shutterstock/Jelena Bujišić
Comparative experiences for digital nomads - Draft Program for attracting digital nomads MJU, Photo: Shutterstock/Jelena Bujišić
Disclaimer: The translations are mostly done through AI translator and might not be 100% accurate.

For Montenegro, as a tourist destination, digital nomads have great promotional potential, but they can also influence its investment image.

"Depending on the number of digital nomads residing in the country, comparative practice shows that they contribute together to the budget and economy of the country," states the draft Program for Attracting Digital Nomads in Montenegro until 2025.

A digital nomad, according to an international study mentioned in the document, spends more than a third (36 percent) of monthly earnings on accommodation, food and transportation, and this income usually stays within the destination where they are staying.

Digital nomads income graph
photo: Jelena Bujišić

One of the Government's goals is to have 2023 digital nomads in Montenegro in 250, and 1.000 two years later.

With the aim of their longer stay in the country, it is planned to introduce a set of benefits, which, among other things, would include tax benefits and new e-services for regulating their status.

However, the challenges that Montenegro faces in this area, among other things, are that digital nomads are not recognized at all terminologically, that there is an incomplete normative framework, that restrictive conditions are related to the length of stay of foreigners in relation to what their needs are. .

Therefore, the Ministry of Public Administration, Digital Society and Media (MJU) recognized three operational goals in the draft Program, namely improved normative framework, increased availability of information and services for this category, and increased recognition of Montenegro as an attractive destination for digital nomads.

According to the activity plan, the Ministry of Internal Affairs will work next year on changes to the Law on Foreigners in order to regulate the status of digital nomads and their stay in Montenegro, and with the Ministry of Foreign Affairs on changing the accompanying by-laws.

The Ministry of Finance and Social Welfare will be in charge of amendments to the Law on Personal Income Tax.

In the part that concerns the goal of increasing the recognition of Montenegro as an attractive destination for digital nomads, one of them is to climb from the current 50th position on nomadlist.com, one of the most famous web platforms for evaluating destinations for digital nomads, to within two years 45th, and in 2025 it will be in 35th place in the world.

According to estimates from before the coronavirus pandemic, by 2035, almost a billion people in the world will work from home, and each of them is also a potential traveler, that is, a digital nomad, who stays longer than traditional tourists, who also does not adapt to the seasons, thus extending the tourist season.

The current health situation has only accelerated that trend, where more and more people are working from remote locations, i.e. outside their offices.

There is a small amount of research available on digital nomads, and the results of the conducted show that fast internet is the most important thing for them when choosing destinations and accommodation, followed by favorable climate and low cost of living...

In the document, which is open for public discussion until November 29, the example of Montenegro and four other countries - Serbia, Croatia, Estonia and Georgia - is used in the part that concerns the comparison of internet speed and mobile internet, the price of internet, renting an apartment and that whether the status of nomads is regulated.

The Coordinator of the Working Group for the Development of the Program for Attracting Digital Nomads, Tamara Džuver, said yesterday that Montenegro has many advantages that can benefit the attraction of this category.

Jover
Jover photo: PRCenter/Đorđe Cmiljanić

"In addition to beautiful nature, relatively low cost of living compared to other countries, favorable tax rates, we are also talking about developed infrastructure, accessible internet and low crime rates. When it comes to challenges, we are talking about the inadequately regulated stay of digital nomads, the insufficient availability of information and services for digital nomads themselves, and the promotion of Montenegro as an attractive destination for digital nomads, on which we have to work a lot", said Džuver at yesterday's round table, which was organized by MJU.

In Georgia, the tax is one percent, in Croatia, 1.000 applications have arrived

Digital nomads in Estonia, for example, can, with a digital nomad visa (DNV), live and reside in this country for up to one year.

Their policy is to avoid double taxation ie. taxation in Estonia and in the country where the digital nomad is registered.

Georgia has decided not to charge a visa for digital nomads and freelancers who stay in the country for less than 183 days a year.

In Georgia, it is a big relief that they pay income tax after spending 183 days during the year in the country of only one percent and if they earn less than $155.000.

Croatia officially started the procedure for DNV in January and thus became the seventh country in the world whose legislation allowed digital nomads to work in the country. In just a few months, they accepted about 1.000 applications from 25 countries.

Any foreigner who proves that he is a digital nomad is exempt from taxes and tax reporting for the activity on the basis of which he received the visa.

In Serbia, digital nomads are exempt from paying income tax on the condition that they spend no more than 90 days on the territory of Serbia in a period of 12 months starting or ending in the corresponding tax year.

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