Salary & Payroll Taxation in Montenegro ("Evropa Sad" Reform)
Employment taxation in Montenegro is governed by the Law on Personal Income Tax (Zakon o porezu na dohodak fizičkih lica) and the revolutionary "Evropa Sad" (Europe Now) fiscal reform:
- Personal Income Tax (PIT / Porez na dohodak):
- Gross Salary up to €700.00/month: 0.0% Tax (Complete minimum wage tax exemption).
- Gross Salary between €700.01 and €1,000.00/month: 9.0% on the portion exceeding €700.
- Gross Salary exceeding €1,000.00/month: 15.0% on the portion exceeding €1,000.
- Abolition of Mandatory Health Insurance: Contributions for state health insurance (previously 10.5%) were reduced to 0.0%; healthcare is now funded directly from general state budget revenues.
- Pension and Disability Insurance (Fond PIO):
- Employee contribution: 15.0%.
- Employer contribution: 5.5%.
- Unemployment Insurance & Labor Fund:
- Employee: 0.5%.
- Employer: 0.5% + Labor Fund 0.20%.
- Municipal Surtax (Prirez porezu): 13.0% (standard municipalities) or 15.0% (Capital City Podgorica and Cetinje) calculated on the PIT amount.
Statutory Regulatory Framework: Compliant with the Law on Personal Income Tax (Evropa Sad), Law on Corporate Profit Tax, Labor Law of Montenegro, and regulatory decrees issued by the Revenue and Customs Administration (UPC) and REGAGEN.