The sudden removal of incentives jeopardizes business operations and investor confidence
The Serbian IT Association (SITA), which brings together more than 20 technology companies employing over 4,700 IT professionals in Serbia, expresses deep concern over the decision by the Government of the Republic of Serbia to abolish the Decree on Incentives for Employers Hiring Newly Settled Individuals.
This decision was made without prior consultation with the business sector, and particularly without dialogue with the IT community, which is directly affected by this measure.
In previous years, numerous domestic and foreign companies decided to launch or expand operations in Serbia relying on clearly defined state incentives. These incentives were presented as part of a broader economic development strategy and as a means of positioning Serbia as a regional IT hub. Accordingly, many companies have already hired highly educated professionals from abroad, planning long-term budgets, investments, and business models based on the existing regulations.
A sudden change, without a transition period or prior notice, causes serious disruptions in business planning, reduces predictability, and sends a negative signal to investors regarding the stability of the business environment in Serbia. This decision by the Government will directly result in stagnation, and likely a decline in IT service exports from Serbia, as well as a slowdown in technological progress in the fields of digitalization and artificial intelligence.
“The Serbian IT Association calls for an urgent dialogue with Government representatives to discuss transitional measures and find solutions to protect companies that, relying on the existing legislation, have already invested significant funds and initiated employment in accordance with the Decree. We also appeal for the establishment of a long-term, sustainable, and transparent incentive mechanism that will ensure stability and encourage further development of the technology sector in Serbia,” SITA representatives stated. Additionally, they demand the prompt payment of funds under the Decree on Incentives for Newly Settled Individuals for the period from September 2023 to August 2024.
Moreover, such an abrupt change may lead to an exodus of IT professionals from Serbia and prompt companies to seriously reconsider their employment and development plans in the country.
The Serbian IT Association reminds that the total revenue of its member companies exceeds 375 million euros, of which nearly 290 million euros come from service exports. The organization is committed to improving the regulatory framework, developing local talent, and creating a business climate that simultaneously attracts foreign investors and supports domestic experts, with the aim of ensuring Serbia’s long-term competitiveness in the global IT market.
