Confederation of Autonomous Trade Unions of Serbia (CATUS) and TUC NEZAVISNOST don’t give up their demand on minimum wage increase for 2022 and they estimate that the Government of Serbia, i.e. President Aleksandar Vučić, will decide about this, like it happened last year.
As CATUS Council Secretary Zoran Mihajlović explained, there are three types of minimum wage increase.
‘The first one is to equalize minimum wage, which currently amounts to 32,000RSD (272EUR), to the value of minimum consumer’s basket up to 39,000RSD (331EUR). The second option is the one suggested by President Vučić – to set the amount of 35,000RSD (297EUR) and this will probably happen’, explains Mihajlović.
As it has been announced, CATUS will propose the third option: to increase the minimum wage so that it could come closer to the average wage of around 43,00RSD (365EUR). Negotiations on the minimum wage are supposed to begin in the mid-August.
Mihajlović added that it would be most realistic if the minimum wage was brought to the level of minimum consumer’s basket of 39,000RSD. In that case other wages and pensions would need to be increased so that ‘compression’ could be avoided. He also pointed that employers’ proposal was unacceptable because if the basic amount, to which contributions weren’t paid, was increased, health insurance fund would get empty.
According to the Director of Employers’ Association of Serbia, Srđan Drobnjaković, there are two options. The first one is to increase the minimum wage by 10%, meaning to 35,000RSD and make it equal to the untaxed amount and the second one is to raise the untaxed base of today’s 18,300RSD (155EUR) to 26,000RSD (221EUR).
He pointed out that employers knew the budget had to get filled, so they agreed with the proposal to raise the nominal income tax rate from 10% to 15% and decrease the overall taxes and contributions by around 1.5%. Finally he estimated it was about time to change the tax system and transfer from the proportional to progressive taxation.
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