The two Kosovo institutions on which the filling of the state coffers depends - Customs and Tax Administration - have recorded an increase in revenues in the months so far this year, compared to the same period last year.
As of August 22, Customs has managed to collect one billion euros, exceeding last year's amount by 71 million euros. Similarly, the Tax Administration has collected 515 million euros, or 79 million more than in the same period in 2022.
For the acting executive director of TAK, Ilir Murtezaj, there are several factors that have influenced the increase in the performance of tax revenues.
"The increase in accountability, responsibility of the staff, then the numerous campaigns with which we are calling on the business community to fulfill their tax obligations, as well as the automation of many work processes", highlights Murtezaj.
For economic experts, this is not the best news. The state budget, according to them, would be more stable if it were filled by the production sector.
"If Kosovo has a higher level of domestic production, this multiplies the circulation of funds within the Kosovo market - whether money coming from the diaspora or generated from wages in Kosovo," says university professor of economics Muhamet Mustafa.
"If we import everything from abroad - whether it's food or components for building houses - this effect goes to the countries from which we import, it doesn't remain in Kosovo," he adds.
Kosovo has been facing a high trade deficit for years - meaning it imports more than it exports - despite the authorities' pledges to strengthen the manufacturing sector.
How is the manufacturing sector strengthened?
The professor of economics at the University of Pristina, Nagip Skenderi, says that this is done through economic reforms.
According to Skenderi, businesses in Kosovo continue to face numerous problems that prevent them from being competitive in international markets.
He mentions high value added taxes, high interest rates on loans, unfair competition and others.
"Companies that manage to export should be favored, not pay customs taxes and have a competitive price in the international market. Strengthening the manufacturing industry is the basis for increasing the budget", says Skenderi.
In this spirit, the president of the Chamber of Commerce of Kosovo, Lulzim Rafuna, declared earlier for REL.
Based on the information he has, he said that businesses in Serbia, North Macedonia and some other countries in the region have better fiscal policies and are subsidized by the state.
"Electricity for the producer in Kosovo is not subsidized, while in other countries they have facilities. In some countries, producers are also exempted from packaging taxes, while in Kosovo they are not", said Rafuna.
Kosovo imports most of its products - from flour to construction materials - from neighboring countries and those of the European Union. This is despite the fact that, according to official data, there are about 2,400 manufacturing companies.
What is the import value?
The data of the Kosovo Statistics Agency for the month of July show that, compared to July last year, the value of import has increased, while that of export has decreased.
According to KAS, the country imported goods worth 512 million euros in July, or 10 million euros more than in the same period of 2022. The export value, meanwhile, was 67 million euros or 9 million euros less than a year ago.
From the calculation of the figures of the Central Bank of Kosovo in the last five years, it appears that the value of imported goods has reached tens of billions of euros.
What does the Government of Kosovo say?
In the four-year program of the current Government of Kosovo, there is a commitment to orient the economy towards production and export.
"The government will support businesses in the purchase of production and processing machinery, aiming to digitize the processing process and increase processing and production capacities," the program states.
In July, the Ministry of Trade, Industry and Entrepreneurship of Kosovo offered financial support, in the amount of one million euros, for the purchase of production and processing machines for small and medium-sized manufacturing enterprises.
The aim of supporting these businesses is to increase investment, increase competition and create new jobs.
The Medium-Term Expenditure Framework 2023-2025 - the document on the basis of which the budget is drafted - also states that the manufacturing industry will be a priority.
"The Government's priorities for the next three-year period will focus on reorienting the economy towards production and export, increasing dignified employment for all", the document states, among other things.
From the forecasts in it, the state budget for 2024 will be 3.2 billion euros, as much as it is this year. /REL/
