Increase in the minimum labor price is possible with a reduction in payroll taxes

An increase in the minimum labor price is possible only if taxes and contributions on earnings are reduced, 87% of companies said in a survey conducted by the Serbian Association of Employers (SAE). The negotiations between the SAE, representative unions and the Government of Serbia on the minimum labor price for 2023 should begin in the first days of August, and SAE traditionally inquires about the positions of companies on this topic before the negotiations start.

Out of the total number of employers surveyed, 68.3% agreed with the assessment that the conditions for increasing the minimum labor price have been met, and this share is 5% higher than the previous year. Slightly less than a third of employers (31.7%) believe that there are no conditions for increasing the minimum wage.
Among the employers who believe that the conditions have been met for increasing the minimum wage, the largest part (19.8%) believes that the optimal increase is between 9 and 12%. This means that the net minimum monthly salary would be around 41,500 dinars.

An increase of up to 5% was supported by 4.5% of respondents, 6-8% by 12.4%, 13-15% by 12.7% of respondents, and an increase in the minimum wage above 15% is supported by 17.8% of employers who find acceptable increase in the minimum.

The vast majority of respondents see a reduction in taxes and contributions to wages as a measure that would help companies to pay the increased minimum wage. The next measure that would be significant for the economy is the increase of the non-taxable part of the salary, followed by the reduction of fiscal and para-fiscal levies.

Among the companies which assessed that there are no conditions for increasing the minimum labor price, the overwhelming majority (81% of them, or a quarter of the total number of respondents) believe that this would endanger the business of the company).

A decrease in the number of employees is announced by 39%, that is, over 12% of the total number of participants in the survey.

356 companies, employing over 44,000 people, participated in this year’s survey by SAE.

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