Montenegro

Social security contributions (SSCs)

The mandatory SSCs in Montenegro include:

• pension and disability insurance and
• unemployment insurance.

There is an annual cap for pension and disability insurance contributions.

Regarding SSCs on salaries, the entire pension and disability insurance, set at a rate of 10%, is borne by the employee. Costs of unemployment insurance are borne by both the employee at rate of 0.5% and by the employer at rate of 0.5%.

Employers are liable to calculate and withhold mandatory SSCs at the payment of employees' salaries. The mandatory SSCs borne by the employer represent their operating expenses.

SSCs are also levied on other types of personal income in accordance with the SSC Law.

Consumption taxes

Value-added tax (VAT)

The main principles of the Montenegrin VAT align with the European Union (EU) Sixth Directive guidelines. The subject of VAT includes the supply of goods and services for consideration, as well as the import of goods into Montenegro. The general VAT rate is 21%. Certain supplies of goods and services, as well as the import of goods, are subject to reduced VAT rates.

See the Other taxes section in the Corporate tax summary for more information.