Amendments to the Law on Tax Procedure and Tax Administration: Temporary Ban on Performance of Business Activity in the Course of Tax Audit
In December of 2022, The National Assembly of the Republic of Serbia adopted Amendments to the Law on Tax Procedure and Tax Administration, which enter into force on the eighth day from the day of publication in the Official Gazette of RS, precisely on December 21, regarding the following.
Amendments to the Measures of Temporary Ban on Performance of
Business Activity in the Course of Tax Audit
(Article 131.)
The previous provisions prescribed a maximum period of duration of the Temporary Ban, meaning that the tax auditor, when an appropriate basis for the Temporary Ban has been established, had the discretionary authority to determine the duration, ultimately leading to an unequal position of the taxpayers in this course of tax audit.
The Amendments now prescribe that the tax auditor is obliged to determine the period of Temporary Ban in accordance with the provisions, i.e., a ban on performance of business activity shall be imposed on the taxpayer for the duration of 15 days if an irregularity has been found in the tax audit procedure for the first time, unlike previous provisions prescribing the ban for up to 15 days.
As an exception to the above stated duration period, a Temporary Ban on the performance of business activity for a taxpayer who performs activities on the premises of various events (fairs, festivals, exhibitions and other events as part of cultural, musical, sports and other social activities) is imposed for the duration of that event. This Amendment was adopted for the purpose of alignment with the Amendments to the Law on Fiscalization.
Amendments to the Decision on Measures
The tax auditor shall impose measures through a Decision, with the prospect of seizing goods and vehicles or other means used to transport and/or supply the goods, in addition to the books of accounts, records, and other documents via non-written verbal Decision, where tax collection might be in jeopardy.
Issuing such Decision is now feasible if the tax auditor establishes a Temporary Ban on performance of business activities in accordance with Article 131.
The adoption of Amendments in order to comply with the Law regulating criminal proceedings
Per the Law on Criminal Proceedings the defendant must have the assistance of counsel if the proceedings are being conducted in connection with a criminal offence punishable by imprisonment for a term of a minimum of eight years– from the first interrogation until the conclusion of the criminal proceedings.
With that in mind, the Amendments now prescribe that, unless provided by the taxpayer/defendant beforehand, the Tax Administration – the Tax Police, shall, in the pre-investigation process, appoint a defence attorney ex officio for the course of hearings due to present grounds for suspicion that the taxpayer/defendant has committed a tax crime punishable by imprisonment for a term of a minimum of eight years.