(Podgorica, 4 June 2012) – Instead of creating conditions that would allow business people to create profits and employ new people, the Government of Montenegro is preparing another imposition that will ensure that prices will once again jump.
The government’s intention to increase the value added tax (VAT), once again demonstrates that it has no intention of improving life in this state or for its citizens, but to take away from them the little that honest business people are able to earn in such conditions.
They think that by increasing the VAT they will resolve the economic crisis, but they are not paying attention to the fact that within the EU such problems are resolved by stimulating business to create new jobs.
When these companies begin working and creating revenues, then the state will see an expansion in the potential sources of taxation, which has been shown as a useful way of increasing budgetary revenues in most EU states.
The intention of the Government of Montenegro to increase the VAT by an additional 2% will influence consumer prices, forcing businesses to decide whether they will increase the price of goods and services or if they will shoulder the losses. In the later case, the state will lose sources of taxation over the long term since honest businesses will be forced to go under.
Even though Igor Luksic’s government justified its actions in introducing taxes on phones, cable and internet services by claiming this was an alternative to raising the VAT – which would lower purchasing power and have a negative impact on the service and tourism sectors – it is clear that they were lying to us since after a week they resorted to exactly those measures they claimed that they wouldn’t take.
While citizens are already facing an increase by several euros in their phone, internet, electricity and cable bills, the government will in the meantime prepare new price increases.
Luksic’s cabinet does not seem concerned with how citizens, including the unemployed who receive only €33 / month, are going to survive these new impositions.
On the other hand, instead of taxing the extra-profits of tycoons, the Government grants them tax exemptions and guarantees their lines of credit with foreign banks that are worth millions of euros. It thus protects foreign and domestic “controversial businessmen” from bankruptcy and enables their suspicious financial transactions (which are tolerated by the highest financial institution in the state).
For this reason we are calling on all honest business people, professors and those who know how to fight against the ill intentions of this government to join us, since tomorrow we will certainly be poorer than we are today if this continues. We must not remain quiet and pay for the enrichment of the Djukanovic family, while the people of Montenegro no longer have bread to eat.
Citizens’ Front
Economic Team
