Montenegro’s Parliament approved significant amendments to the Payment Services Law on 10 July, with a unanimous vote of 42 in favor and no opposing votes. The amendments establish a legal framework for real-time payment access that operates 24/7, require mandatory verification of payment recipients, and enhance protections against fraud and erroneous transactions.
This reform is expected to foster increased competition among banks and payment service providers, while also paving the way for the introduction of fintech products. The commercial implications of these changes will largely depend on how swiftly banks, the Central Bank, and merchants implement the necessary technical integrations.
Additionally, a new VAT law was introduced on 9 July, which aligns Montenegro more closely with EU Directive 2006/112. This law does not alter existing general or reduced VAT rates but establishes a framework for electronic invoicing, digital reporting, enhanced cross-border information exchange, and broadened reporting requirements for digital platforms, cryptoassets, and specific international tax arrangements.
The implementation of this VAT law is anticipated to improve auditability and mitigate aspects of the informal economy. However, it will necessitate investments in accounting software, tax administration systems, and internal controls. Smaller enterprises in sectors such as tourism, retail, and professional services are expected to face the most significant compliance challenges.
Moreover, tax enforcement activities have intensified recently. From 1 May to 8 July, authorities conducted 1,129 inspections, uncovering irregularities at 177 taxpayers. This led to the temporary closure of 14 facilities and fines totaling €910,800. Budva reported the highest concentration of these irregularities.
