Montenegrin government resists cashing in on property tax
The Montenegrin government has come under pressure to increase tax on property transactions but the ruling party has resisted, asserting it does not want to deter buyers.
Foreign investment in the country's property market is flooding in thanks to its low prices and natural beauty, with Britons, Irish and Russians investing most into the market.
Property taxes are just 2% and government revenue has increased from Ôé¼3.84 million (~£2.58 million) in 2004 to Ôé¼14.64 (~£9.85 million) in 2006. Total income from property sales quadrupled in the same period to around 750 million, the Balkan Insight reports.
Opposition parties have claimed the government could make significantly more revenue for the burgeoning level of foreign investment, but the government has been more temperate, keen to encourage investment.
Assistant finance minister Kovilijka Mihajlovic said: "We'll probably make some assessments over the course of this year and most likely decide to increase the tax. However, this tax rise would not be significant and it would come in force before next January."
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