VESIC: Employers will have to prove that the money paid to employees for public transport was used for that purpose

Deputy Mayor of Belgrade Goran Vesic has stated that, in the future, employers who pay money for public transport to their employees directly, instead of paying for monthly tickets, will have to prove that the entire amount was used for the purpose, Beoinfo reports.

– Under the Labor Law, the state obliges employers to pay this amount if the company doesn`t organize the transport itself. No taxes or contributions are paid to this amount, so it can only be used for the intended purpose. Some employers abuse this, including the amount in the salary and thereby cheating the state out of money, while also preventing their employees from exercising their right to transport. That is why, in the future, employers will be obliged to prove that the money was really used for the intended purpose – Vesic said.

He said that, at the request of the city of Belgrade, the Ministry of Finance adopted an opinion in early February under which, if the employer doesn`t have proper documents based on which they can prove that the commuting expenses have been compensated for properly (slips, tickets, fuel bills), the money spent can`t be recognized as an expense, as per Article 7a, Paragraph 1 of the Law on Income Tax for Legal Entities. The opinion was published in Privredni Savetnik no. 5 from February 2019.

Vesic said that the number of employees in the territory of the City of Belgrade in 2018 had amounted to 717,998 a month on average, whereas only 114,429 of those had bought monthly public transport fares, even though, although surveys say that public transport is used by around 47.9% of the users. This means that around 250,000 employed people use public transport without paying the ticket, due to which the City of Belgrade loses at least RSD 750 million a month, or nearly RSD 9 billion a year.

– If the number of prepaid cards sold increased by only 100,000, it would mean that the difference in the amount collected could be used to buy around 180 new buses, which would mean that the entire rolling stock of the PUE GSP Beograd could be renewed in 4-5 years – Vesic said.

Grad Beograd

Ministarstvo finansija Republike Srbije

JKP GSP Beograd

PRIVREDNI SAVETNIK BEOGRAD

City of Belgrade

Goran Vesic

Ministry of Finance

PUE GSP Beograd

compensation for public transport for employees in Belgrade

Official Gazette

Law on Income Tax for Legal Entities