Prime Minister Dimitar Kovachevski highlighted that Macedonia boasts the region’s lowest VAT rate. Food items with increased prices still enjoy a reduced VAT rate, standing at 5 percent.

This list of products has been meticulously curated by tax and financial experts as part of the country’s successful tax reform, recently validated by Macedonia’s credit rating during a crisis.

Kovachevski stated that the list contains approximately 1,600 products that are staples in citizens’ daily lives. Macedonia’s basic VAT rate is 18 percent, considerably lower than Serbia’s 20 percent, Croatia’s 25 percent, Greece’s 21 percent, and Albania’s 20 percent.

He reassured that prices for items like flour and domestically produced cheese, subject to the 5 percent VAT rate, won’t increase significantly. Measures have been taken to reduce the prices of essential food products by up to 30-40 percent.

Inflation data indicate forthcoming price decreases. Kovachevski expects the country to maintain its projection of 5 percent inflation, one of the lowest rates in the region and Europe.

The list of products subject to a 5 percent VAT rate, comprising 1,600 items, may undergo minor revisions, primarily for a few products currently taxed at 10 percent. This extensive list encompasses not only food items but also those related to food production, such as fertilizers, seed materials, and agricultural machinery.

Kovachevski emphasized that the tax reform aligns with the International Monetary Fund and the World Bank.