First Steps Towards B2B E-Invoicing Mandate in Montenegro

Representatives from the Ministry of Finance of Montenegro, alongside the Minister in the last week of October, held a roundtable discussion about electronic invoicing and digital reporting. This meeting is the logical next step after the talks held in September 2023, when representatives from the Montenegro Government started the open dialogue about the possibility of licensing a Serbian centralized E-Invoicing Platform. 

The roundtable discussion had a positive outcome, and the Serbian Government permitted Montenegro to use its state-developed centralized E-Invoicing Platform through a free license for three years. 

Timeline 

At the present moment, there hasn’t been any sort of update concerning the timeline for the introduction of the electronic invoicing system. 

Based on the license’s validity period starting next year, the development of the local centralized E-Invoicing Platform could start. 

Technological Landscape of Tax Reporting 

A few years back, the Ministry of Finance, alongside the Tax Administration, had designed the reform of the VAT reporting system for the retail sector. The so-called fiscalization system has been radically changed. For many years, Montenegro, as well as many other neighboring countries, had a so-called hardware-based fiscalization system in place when we talked about reporting VAT data from the retail sector. 

This year, the reform has been finished, and the VAT reporting system has been entirely digitalized, which can be seen by moving from an exclusively hardware-based cash register system to online – digital reporting of VAT data for B2C transactions within retail. 

Looking at this gradual shift and openness towards digitalization of tax reporting obligations and the recently signed license agreement with the Serbian Ministry of Finance, it’s safe to assume that in the next year, initial steps towards the transformation of invoicing could be made. 

Impact

Serbia is the first country in the Balkan peninsula to introduce the mandate of B2B e-invoicing for VAT payers and entrepreneurs. The system represents the CTC model, based on the state-owned centralized e-invoicing platform E-Faktura. 

Based on the contractual agreement between the two Ministries, it could be expected that Montenegro could follow the steps of the Serbian CTC model with some local adjustments.