ISSN 1452-6662
Više od 180 osnovnih i prečišćenih tekstova propisa Republike Srbije prevedenih na engleski jezik.
Grupa: TAXATION SYSTEM IN SERBIA, ACCOUNTING AND AUDITING
Izdanje: BUDGET SYSTEM LAW
Published in the Službeni glasnik RS, Nos. 54/09 of 17 July 2009, 73/10 of 12 October 2010, 101/10 of 29 December 2010, 101/11 of 30 December 2011, 93/12 of 28 September 2012, 62/13 of 16 July 2013, 63/13 of 19 July 2013 (Corrigendum), 108/13 of 6 December 2013, 142/14 of 25 December 2014, 68/15 of 4 August 2015 (other law), 103/15 of 14 December 2015, 99/16 of 12 December 2016, 113/17 of 17 December 2017, 95/18 of 8 December 2018, 31/19 of 29 April 2019, 72/19 of 7 October 2019 and 149/20 of 11 December 2020
Sekcija: I GENERAL PROVISIONS

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  • Subject of the Law
     Article 1

    This Law shall regulate: planning, preparation, adoption and execution of the budget of the Republic of Serbia; planning, preparation, adoption and execution of the budget of autonomous provinces and local government units (hereinafter: local government budget); preparation and adoption of financial plans of the Republic Fund for Pension and Disability Insurance, the Republic Fund for Health Insurance, the Military Social Security Fund and the National Employment Service (hereinafter: organizations for mandatory social insurance); budget accounting and reporting, financial management, control and audit of beneficiaries of public funds, the budget of the Republic of Serbia, and the local government budget, and financial plans of organizations for mandatory social insurance; scope of work and organization of the Treasury Administration, as an authority within the Ministry of Finance (hereinafter: the Treasury Administration) and local government treasury, and other issues relevant for the functioning of the budget system.

    This Law shall establish the fiscal principles, rules and procedures on the basis of which fiscal framework is to be defined, so as to ensure the long-term sustainability of fiscal policy.

    This Law shall establish the Fiscal Council, which shall independently assess the credibility of fiscal policy in terms of compliance with established fiscal rules, thereby ensuring transparency and accountability of governance.

    Certain provisions of this law shall regulate budget relations and rules applied to extrabudgetary funds, economic entities and other legal persons in which the government, at all government levels, has the decisive influence on management, namely: preparation of financial plans, financial asset management, borrowing and guarantee issuance, accounting, preparation and submission of reports and budget control execution, which are, in view of sources of financing and control, included in the general government (hereinafter: extrabudgetary beneficiaries).

    This Law shall also regulate types and categories of public revenues and proceeds and public expenditures and outflows.

  • Definitions
     Article 2

    Definitions used in this Law shall have the following meaning:

    1) Law on the Budget of the Republic of Serbia shall mean the law whereby revenues and proceeds are estimated and expenditures and outflows are determined for one or three years (capital outflows are reported for three years) and which is adopted by the National Assembly; it also contains provisions relevant for its implementation; in the event that the budget is adopted for three years, revenues and proceeds, expenditures and outflows shall be presented separately for each year;

    2) Budget Decision shall mean the decision whereby revenues and proceeds are estimated and expenditures and outflows are determined for one or three years (capital outflows are reported for three years) and which is adopted by the autonomous province assembly, and/or the municipal assembly, and/or the town assembly, or the City of Belgrade Assembly (hereinafter: local government assembly); also contains provisions relevant for the execution of the said Decision; in the event that the budget is adopted for three years revenues and proceeds, expenditures and outflows shall be presented separately for each year;

    3) Financial plan shall mean an act of a direct or indirect budget beneficiary, as well as an act of an organization for mandatory social insurance, which also includes financial plans of indirect beneficiaries of funds of organizations for mandatory social insurance, prepared on the basis of the Budget Preparation Instruction, in accordance with the guidelines for the preparation of medium-term plans and projections of medium-term expenditure framework provided for by the Fiscal Strategy, containing an estimate of the scope of revenues and proceeds and the scope of expenditures and outflows for a period of one or three years (capital outflows are reported for three years);

    4) Public funds shall mean the funds available to and controlled by the Republic of Serbia, local government, and organizations for mandatory social insurance;

    5) Public funds beneficiaries shall mean direct and indirect budget beneficiaries, beneficiaries of funds of organizations for mandatory social insurance, public enterprises founded by the Republic of Serbia, and/or or local government, legal entities founded by such public enterprises, legal entities over which the Republic of Serbia, and/or local government, has direct or indirect control over more than 50% of equity, or more than 50% of votes in the Management Board, as well as other legal entities where public funds comprise more than 50% of total revenues achieved in the previous fiscal year, as well as public agencies and organizations that are governed by regulations governing public agencies; The National Bank of Serbia does not consider itself to be a beneficiary of public funds within the meaning of this Law, and the provisions of the law governing the position, organization, powers and functions of the National Bank of Serbia shall apply on the assets that it uses, revenues, expenses and capital, as well as on the financial reporting;

    6) Budget beneficiaries shall mean direct and indirect beneficiaries of budget funds of the Republic of Serbia and/or of local government;

    7) Direct budget beneficiaries shall mean authorities and organizations of the Republic of Serbia, and/or authorities and offices of local government;

    8) Indirect budget beneficiaries shall mean: judicial bodies; local communities; institutions founded by the Republic of Serbia and/or local government, where the founder, through direct budget beneficiaries, executes legally prescribed rights in terms of management and funding;

    9) Beneficiaries of funds of organizations for mandatory social insurance shall mean organizations for mandatory social insurance and beneficiaries of funds of the Republican Health Insurance Fund (health and pharmacy institutions founded by the Republic of Serbia and/or by the local government);

    10) Extrabudgetary funds shall include legal persons founded by the law, which are financed from specific taxes, dedicated contributions and non-tax revenues;

    11) Central government level shall include all entities that are responsible for the provision of predominantly non-market services and redistribution of income and wealth at the level of the country as a whole; it shall include the budget of the Republic of Serbia and extrabudgetary funds, also including social insurance funds;

    12) General government level shall include all entities that are responsible for the provision of predominantly non-market services and redistribution of income and wealth at all government levels; it shall include the budget of the Republic of Serbia, budgets of local governments, extrabudgetary funds, also including social insurance funds at all government levels as well as non-market and non-profit institutions that are controlled and financed by the government at all government levels;

    13) Public sector shall mean a part of the national economy that includes general government level as well as non-financial enterprises under the government control (public enterprises) primarily engaged in commercial activities;

    14) Public revenues shall mean all revenues generated by mandatory payments by tax payers; legal and natural persons utilizing a specific public good or public service, as well as all other revenues generated by beneficiaries of budget funds and funds of organizations for mandatory social insurance;

    14a) General budget revenues and proceeds shall mean revenues, i.e. proceeds that are used to finance public spending without a predetermined purpose;

    15) Dedicated revenues and proceeds shall mean public revenues, and/or proceeds usage and purpose of which is determined by a grant, credit, and/or loan contract; as well as self-contribution funds purpose of which is determined by means of a decision of local self-government;

    16) Deleted (see Article 2 of the Law - 93/2012-175);

    17) Tax revenues shall mean the type of public revenues collected by the government through mandatory payments by taxpayers without the obligation of performing any special service in return;

    18) Non-tax revenues shall mean the type of public revenues that are charged to legal entities or natural persons for use of public goods (fees), provision of certain public services (fees), violations of contractual or statutory provisions (fines and penalties), as well as revenues generated by use of public funds;

    18a) Public goods shall mean natural resources the use of which is governed by a special law, as well as goods designated as goods of general interest and goods in general use by a special law;

    18b) Public services shall mean all services that the beneficiaries of public funds are required to provide to legal entities and natural persons;

    19) Government proceeds shall mean the funds generated by the government from the sale of non-financial and financial assets and borrowing;

    20) Public expenditures shall mean expenditures for goods, services and other allowances provided by the government without direct or indirect fee;

    21) Government outflows shall mean government outflows for the purchase of non-financial and financial assets and loan repayment;

    21a) Capital projects shall mean construction projects and capital maintenance of buildings and infrastructure facilities of interest to the Republic, or local government, including project planning services that constitute an integral part of a project, the provision of land for construction, as well as projects that require investment in equipment, machinery and other non-financial assets, which serve the public interest;

    22) Tax expenditures shall mean exemptions and relief from common tax structure, which reduce the amount of collected revenues and may be introduced only by the laws that introduce related taxes; The anticipated amount of the tax expenditures, annually, is declared in the general part of the budget law of the Republic of Serbia;

    23) Budget shall mean a comprehensive plan of revenues and proceeds and expenditures and outflows, organized into two separate accounts: a) an account of revenues and proceeds generated from the sale of non-financial assets and expenditures and outflows for the purchase of non-financial assets and b) a funding account; the budget shall constitute the main document of economic policy of the Government;

    24) Budget surplus or deficit shall mean the difference between the total amount of revenues and proceeds generated from sale of non-financial assets and the total amount of expenditures and outflows for the acquisition of non-financial assets;

    25) Total fiscal surplus or total fiscal deficit shall mean the budget surplus or budget deficit modified relative to the assets and liabilities transactions performed for the purpose of pursuing public policies; proceeds generated by privatization shall be treated as financial assets and included in the financing account; subsidies granted in the form of loan or acquisitions of financial assets shall be deemed expenditures;

    25a) Fiscal policy shall mean the decisions made or actions taken by public authorities in connection with public revenues and proceeds and expenditures and outflows and the accumulation of public assets and liabilities, with the purpose of influencing economic trends and achieving the objectives of fiscal policy;

    25b) Fiscal policy objectives shall refer to the precise numerically expressed target values ​​of the main fiscal aggregates that the Government is attempting to achieve in the budget;

    25v) Anti-cyclical fiscal policy shall mean that the fiscal deficit is greater than the target value during the years wherein the growth rate of the gross domestic product (hereinafter: GDP) is smaller than the potential growth rate, and during the years wherein the GDP growth rate exceeds the potential growth rate, the fiscal deficit is smaller than the target value or a surplus is achieved;

    25g) Potential GDP growth rate shall mean the highest growth rate that can be achieved in a given period without an increase in the inflation rate;

    25d) Fiscal principles shall refer to the principles of responsible fiscal management;

    25đ) Fiscal procedures shall comprise the preparation, submission and publication of reports, forecasts, assessments and statements as specified by this Law;

    25e) Fiscal risks shall mean the short-term and medium-term deviations of fiscal variables from the values specified in the budget, financial or other statements or projections of public finance;

    25ž) Fiscal rules shall refer to the setting of limits to fiscal policy in order to strengthen budget discipline, improve coordination between different levels of government and reduce uncertainty with respect to future fiscal policy;

    25z) Fiscal Council shall constitute an independent body formed with the objective of improving the culture of fiscal responsibility in the Republic of Serbia by providing independent analysis of fiscal policy and encouraging professional debate on fiscal policy;

    25i) Fiscal strategy shall refer to a document that sets forth the objectives of the fiscal policy of the Government and assesses the sustainability of fiscal policy, which is submitted by the Government to the National Assembly;

    25j) Fiscal sustainability shall mean the possibility of implementing a given fiscal policy over a longer period of time without significant changes in tax policy and expenditures and outflows;

    25k) Report on achieved progress shall constitute an addendum to the Fiscal Strategy that comprises the achieved results of the fiscal policy as set forth in the Fiscal Strategy that was adopted in the previous fiscal year;

    26) Consolidation shall mean the presentation of revenues and proceeds and expenditures and outflows of several interconnected budgets and extrabudgetary funds as if it were a single entity; in order to avoid double counting, consolidation excludes mutual transfers between them as well as between different government levels;

    27) Consolidated budget of central government shall mean the budget after excluding mutual transfers between different entities at the central level of government, in order to avoid double counting, with the principles for determination of results for the budget of the Republic of Serbia applying to the consolidated budget of central government as well;

    28) Consolidated budget of general government shall mean the budget after excluding mutual transfers between different entities at the same level of government as well as between different levels of government, with the principles for determination of results for the budget of the Republic of Serbia applying to the consolidated budget of central government as well; this shall be a real indicator of the financial position of the government, the revenues, expenditures and debt;

    29) Consolidated balance of a town, and/or the City of Belgrade shall mean a balance of total revenues and proceeds and total expenditures and outflows of a town budget and/or the budget of the City of Belgrade, and the budgets of its constituent municipalities, which shall be adopted by the competent town authority and/or the competent City of Belgrade authority and submitted to the Ministry competent for finance (hereinafter: the Ministry) within 15 days from the day of the adoption of the town Budget Decision, and/or the City of Belgrade Budget Decision;

    30) Supplementary budget shall mean the amendment to the Law on the Budget of the Republic of Serbia, and/or the local government Budget Decision, within a budget year, whereby the budget is amended and/or supplemented; and the supplementary financial plan of an organization for mandatory social insurance shall be the amendment to the financial plan whereby the financial plan is amended and/or supplemented during the budget year

    31) Appropriation shall mean the authorization granted under the Law on the Budget of the Republic of Serbia, and/or under the local government Budget Decision, by the National Assembly, and/or by the local government assembly, to the Government of the Republic of Serbia, and/or local government executive authority, to spend public funds up to a certain amount and for certain purposes during one budget year; and/or amount of funds determined for certain purposes in the financial plan of an organization for mandatory social insurance; permanent appropriation shall mean the budget appropriation under which funds are allotted for obligatory debt repayment and payments based on the issued guarantees; appropriations for indirect budget beneficiaries shall be presented collectively, according to the types of indirect budget beneficiaries and the purpose of funds under the chapter of the direct budget beneficiary that is, in terms of budget, responsible for the indirect budget beneficiaries in question;

    31а) Quota shall mean a restriction on appropriation spending for a certain period;

    32) Financing account shall include proceeds from the sale of financial borrowing and outflows for the acquisition of financial assets and loan and credit repayment;

    33) Financial assets shall include cash funds, receivables, shares and equity interests in legal persons, securities and other investments in legal persons;

    34) Borrowing shall mean contracting of loans, and/or issuance of securities, as stipulated by a specific law;

    35) Government guarantee shall mean a security instrument whereby the Government of Serbia guarantees the fulfilment of obligations for which the guarantee is issued;

    36) Borrowing for current liquidity shall mean contracting of short-term loans, or issuance of short-term government securities for the purpose of financing the current budget illiquidity caused by imbalanced trends in revenues and expenditures and outflows during budget execution;

    36a) Hedging, as an instrument for protection from risks, shall be transactions relating to financial derivatives, which are aimed at managing the risk of foreign exchange rate movements and/or the risk of movements in interest rates, as well as other risks related to borrowing of the Republic of Serbia through conclusion of loan contracts and issuing of government securities. Deals relating to financial derivatives shall be concluded in accordance with the standardized framework contract on financial derivatives which is customary in business practice, i.e. in the manner customary in the business practice;

    37) Commitment creation shall mean engagement of funds by budget beneficiaries and beneficiaries of funds of organizations for mandatory social insurance, pursuant to a legal act that is, at the moment of engagement, expected to result in cash expenditure, immediately or in the future;

    38) Payments shall mean all transactions resulting in a lower financial balance in accounts;

    39) Consolidated treasury account system shall mean a single account of domestic and foreign currency funds deposited on consolidated accounts of the Republic of Serbia treasury and local government treasury, used for executing payments between budget beneficiaries, beneficiaries of funds of organizations for mandatory social insurance and other public funds beneficiaries that are included in the consolidated treasury account, on one side, and entities that are not covered by the consolidated treasury account system, on the other side, said single account is also used for calculation of interbank payments and is kept with the National Bank of Serbia;

    40) Consolidated treasury account of the Republic of Serbia shall mean a single account of domestic and foreign currency funds of Republic of Serbia budget beneficiaries, beneficiaries of funds of organizations for mandatory social insurance, and other public funds beneficiaries that are included in the consolidated treasury account of the Republic of Serbia, which shall be opened in the Republic of Serbia and kept with the Treasury Administration;

    41) Consolidated treasury account of the local government shall mean a single account of domestic and foreign currency funds of local government budget beneficiaries and other public funds beneficiaries that are included in the consolidated treasury account of the local government, which shall be opened for the local government and kept with the Treasury Administration;

    42) Treasury General Ledger shall mean a double-entry bookkeeping ledger, where balances are systematically captured and all changes regarding assets, liabilities, equity, revenues and expenditures are recorded;

    43) Deleted (see Article 2 of the Law - 73/2010-3);

    44) Transfer funds shall mean funds that are transferred from the budget of the Republic of Serbia, and/or local government budget, to a budget at other government level, to a budget on the same government level, and to organizations for mandatory social insurance, as well as between organizations for mandatory social insurance for the purpose of insurance contributions;

    45) Grant shall mean dedicated, non-repayable revenue realized on the basis of a written contract between the grant provider and the grant recipient;

    46) Financial assistance of the European Union shall mean dedicated funds of the European Union that are used pursuant to the rules set forth in agreements between the Republic of Serbia and the European Union;

    47) Financing of the participation of the Republic of Serbia, i.e. local government in the implementation of the financial assistance of the European Union shall mean financial contribution of the Republic of Serbia, i.e. local government to the implementation of the financial assistance program of the European Union, which may be funded from various sources of financing;

    47a) Administrative inspection shall mean inspection activities, official controls, supervision and other measures of protection for the purpose of determining the nature of irregularities, aimed at protection of financial interests of the European Union, and therefor the financial interests of the Republic of Serbia;

    48) State aid shall mean each actual or potential public revenue or reduced collection of public revenues of State Aid beneficiaries, which, in a selective manner, enables the state aid beneficiary a more favourable position in the market compared to its competitors, whereby competition in the market is violated or there is a danger of violating competition in the market;

    49) Sub-account shall mean the dinar and foreign currency account of the funds of the public funds beneficiaries, through which the turnover of funds is carried out, i.e. payment transactions are executed, which shall be opened within the appropriate consolidated treasury account, and kept with the Treasury Administration;

    49a) A record account shall mean the account of budget beneficiaries within the system of budget execution of the Republic of Serbia, i.e. local authorities, where executed payments and proceeds of such beneficiaries are recorded, for all of the transactions through the account for budget execution of the Republic of Serbia, and which does not take part in the financial transactions, as well as the account through which public revenues are paid and which is part of the financial transactions;

    50) Public finance management system shall mean a set of activities and actions aimed at establishing financial coherence regarding the recording of revenues and proceeds and expenditures and outflows, and the execution of expenditures and outflows of the Republic of Serbia budget beneficiaries, and/or local government budget beneficiaries, which shall enable the accomplishment of budget system integrity and budget objectives;

    50a) Public funds management system shall mean a set of activities and actions with the objective of unified planning, disposal, recording and reporting of public funds that are used, and are at the disposal of, beneficiaries of public funds;

    51) Budget execution system shall, as part of the public finance management system, cover processes and actions performed via electronic communication with the Treasury Administration, whose purpose is to execute expenditures and outflows of the Republic of Serbia budget beneficiaries, and/or local government budget beneficiaries, envisaged by the Law on the Budget, and/or the Budget Decision, as well as to execute the expenditures and outflows of said beneficiaries during the period of interim financing;

    51a) Managerial accountability shall refer to the obligation of managers of the beneficiaries of public funds at all levels to perform their duties lawfully, in compliance with the principles of economicity, effectiveness, efficiency and transparency, as well as accountability for their decisions, actions and results correspond to the persons they were appointed by or that transferred responsibility;

    51b) Internal financial control in the public sector shall mean a comprehensive system of measures for the management and control of public revenues, expenditures, assets and liabilities, established by the Government through public sector organizations for the purpose of management and control of public funds, including foreign funds, in line with the regulations, budget, and the principles of sound financial management, namely economicity, effectiveness, efficiency and transparency;

    51v) Financial management and control shall mean a system of policies, procedures and activities established, maintained and regularly updated by the head of an organization that, by way of risk management, provides reasonable assurance of the achievement of organization objectives in an orderly, economical, efficient and effective manner;

    51g) Internal audit shall mean an activity that provides independent objective assurance and advisory activity with a view to contribute to the improvement of the organization's operation; that provides assistance in the accomplishment of the organization's objectives by assessing and evaluating risk management, review and organization management in a systematic and organized manner;

    51d) Irregularity shall mean each and every violation of some of the provisions set forth by the rules and agreements, which is consequence of actions or omissions of persons employed with the public funds beneficiaries, contractors, end users and end receivers, and which results in or may result in a negative effect on the achievement of goals of the public funds beneficiaries and/or in unjustified expenditures;

    52) Law on Annual Financial Statement of the Budget of the Republic of Serbia shall mean the act whereby the National Assembly shall determine total generated revenues and proceeds and executed expenditures and outflows, as well as the financial result of the budget of the Republic of Serbia (budget deficit or surplus) and financing account, for each budget year;

    53) Decision on Annual Financial Statement of the Local Government Budget shall mean an act whereby a local government assembly shall determine total generated revenues and proceeds and executed expenditures and outflows, as well as the financial result of the local government budget (budget deficit or surplus) and financing account, for each budget year;

    54) Decision on Annual Financial Statement of the Organization for Mandatory Social Insurance shall mean an act whereby the competent authority of an organization for mandatory social insurance shall determine total generated revenues and proceeds and executed expenditures and outflows, as well as the financial result of the organization for mandatory social insurance (budget deficit or surplus) and financing account, for each budget year;

    55) Consolidated report of a town, and/or the City of Belgrade, shall mean consolidated report on the annual financial statement of the town budget, and/or the City of Belgrade budget, and annual financial statements of its constituent municipalities, which shall be prepared by the finance authority of the town, and/or the City of Belgrade, and submitted to the Treasury Administration;

    56) Consolidated report of the Republic Fund for Health Insurance shall mean the consolidated report on the annual financial statement of the Republic Fund for Health Insurance and financial reports on the execution of revenues and receipts and expenditures of beneficiaries of the fund, which shall be prepared by the Republic Fund for Health Insurance and submitted to the Treasury Administration;

    57) Consolidated report of the Republic of Serbia shall mean the consolidated report on the annual financial statement of the Republic of Serbia budget, annual financial statements of organizations for mandatory social insurance, Consolidated Report of the Republic Fund for Health Insurance, annual financial statements of the budgets of autonomous provinces, annual financial statements of municipalities and consolidated reports of towns and of the City of Belgrade, submitted by the Government to the National Assembly for consideration;

    57a) Ceased to be valid (see Article 18 of the Law on the Register of Employed, Elected, Nominated, Appointed and Persons Engaged with Public Funds Beneficiaries - 68/2015-22)

    58) Program shall mean a set of measures which are carried out by the budget beneficiaries in line with their core competencies and determined medium-term objectives. It consists of independent, but closely linked components - programmatic activities and/or projects. It is determined and carried out by one or several budget beneficiaries and it is not time-limited;

    58a) Programmatic activity shall mean ongoing and continuous activity of the budget beneficiaries, which is not time-limited. By means of conducting programmatic activity objectives are achieved that contribute to achievement of objectives of the program. It is determined on the basis of closely defined competencies of the budget beneficiaries and it has to be part of the program;

    58b) Project shall mean a time-limited business venture of the budget beneficiaries, by implementation of which objectives of the project, i.e. program are achieved;

    58v) Gender responsive budgeting shall mean incorporating the principle of gender equality into the budgetary process, which implies a gender-based assessment of budgets and restructuring revenues and expenditures in order to promote gender equality;

    59) Medium-term plan shall mean the comprehensive plan of budget beneficiary which shall contain detailed design of all programs, projects and programmatic activities for the budget year, with projections for the following two years, according to the set mid­term goals and priorities, which also serves as a basis for the preparation of the exposition of this beneficiary's financial plan and is prepared in accordance with the budget preparation instruction.

    60) Medium-Term Expenditure Framework (MTEF) shall be an integral part of the Fiscal Strategy, by which the Government determines the total scope of the Republican budget expenditure in line with the defined priority financing areas; which ensures overall fiscal compliance and transparency of the budget planning process and presents a basis for the definition of medium-term scopes for planning and preparation of financial plans of budget beneficiaries.

  • Budget System
     Article 3

    Budget system shall comprise the budget of the Republic of Serbia, local government budgets, and financial plans of organizations for mandatory social insurance.

    Budget system integrity shall be accomplished through a common legal basis, single budget classification, utilization of single budget documentation for the preparation of draft budget and medium-term and financial plans, single budget accounting system, single criteria for budget control and audit, transfer of statistics reports and data from one budget level to another, and observing the principles underpinning the budget process, in line with this Law.