Background

Purpose

To support the Development Agency of Serbia (DAS) and Foreign Direct Investment (FDI) Unit in providing tax-related information to foreign investors.

Objective

To support the DAS and FDI Unit in improving the investment climate in Serbia.

Background

Improving investment climate plays a central role in growth and poverty reduction. To improve the institutional infrastructure for supporting the development of business environment in Serbia, the Serbian Development Agency (DAS) was established in 2015. In the previous period through “Improving the Investment Climate in Serbia” project, DAS was capacitated in terms of some structures, capacity building and procedures to effectively attract new investments and manage the existing projects. The structures developed through previous project was well placed and had good coordination role, helping both the DAS and investors to make promising progress in attracting more direct investments. However, there is a need for further strengthening the DAS capacities and coordination role of the FDI Unit.

The Development Services Agreement between Government of Serbia and UNDP is envisaged to provide a framework for services requested by the Government, for ongoing initiatives of the Government, for which it bears full accountability. Most development services envisaged under the Agreement relate to support to policy making through research, advocacy or policy alternatives, aimed at fulfilling priorities as articulated in the Government plans, presented before Parliament, and in line with progress in achieving the Sustainable Development Goals.

The overall objective of the continuation of FDI Unit is to support effective coordination of all institutions in the Republic of Serbia, relevant for improvement of the investment climate, which in turn directly affects the country’s sustainable growth and development. This particularly will be needed in the next post-pandemic period and as an answer to economic impact of Covid-19. In that sense, UNDP will engage assistance for supporting policy work enabling investment projects, facilitating, and attracting individual FDIs and for continuation of the capacity building of the Development Agency of Serbia.

Duties and Responsibilities

Scope of work

The legal status of foreign workers and applicable tax regime for foreign workforce are continuously gaining more importance as Serbia, like many European countries, is facing labour shortages in all manufacturing sectors. The trend is two-fold, there is an increasing trend of investors employing blue-collar workers from abroad, while at the same time Serbia is becoming a preferable destination for many digital nomads and highly skilled IT experts who are deciding to locate their corporate base in Belgrade and Novi Sad.

UNDP Serbia and Development Agency of Serbia are in search of a consultant which shall conduct a detailed analysis of the tax regime for foreign workers in Serbia. The analysis aims to provide essential information for foreign investors considering opportunities in Serbia.

The Consultant will perform the following tasks:

1. Conduct a comprehensive review of Serbian tax laws, regulations, and related documents regarding the taxation of foreign workers, based on their employment status and type of contract.
2. Analyze the tax treatment for foreign employees, including income tax rates, social security contributions, and other applicable taxes. Consider implications of various bilateral agreements between Serbia and countries from which most foreign workers in Serbia originate /the list shall be provided by Development Agency of Serbia/.
3. Examine any tax incentives, exemptions, or benefits available to foreign investors and foreign employees, such as investment allowances or special tax regimes.
4. Identify potential challenges or complexities in the taxation system specific to foreign workers, such as residency requirements, double taxation agreements, or transfer pricing regulations.
5. Compare the taxation treatment of foreign workers in Serbia with relevant international standards and best practices in countries with similar investment climate.
6. Prepare a comprehensive report outlining the findings, including a clear explanation of the tax obligations, requirements, and benefits for foreign workers in Serbia.
7. Prepare overview of taxation treatment and potential benefits derived from bilateral agreements with countries from which the most of FDIs originate /the list shall be provided by DAS/.
8. Provide recommendations and guidelines for foreign investors and their employees to ensure compliance with Serbian tax laws and optimize tax planning strategies.
9. To cooperate closely with DAS and FDI unit.

Description of Responsibilities

Duties, responsibilities and key milestones

The consultant is responsible for the following deliverables:

* The timelines may be slightly adjusted once the contract is signed with the consultant in order to align with actual project implementation.

All reports shall be in submitted electronically, in English language.

All deliverables shall be quality reviewed and accepted by the Technical Advisor for Investment Climate in consultation with the UNDP Portfolio Manager.

Competencies

• Demonstrates strong oral and written communication skills (English and Serbian);
• Ability to work in teams and share ideas and knowledge;
• Displays cultural, gender, religion, race, nationality and age sensitivity and adaptability;
• Demonstrates integrity by modelling ethical standards;
• Full computer literacy in the use of MS Office package, especially Word;
• Excellent written communication skills and analytic capacity and ability to synthesize relevant collected data and findings for the preparation of quality analysis.

Required Skills and Experience

Education

• BSc/BA in Economics, Law, Finance or other related field;
• MA/MSc shall be considered an asset.
• Specialization in the field of tax consulting shall be considered an asset.

Work Experience

• At least 10 years of relevant working experience in the area of financial and tax analysis;
• Excellent knowledge of Serbian and EU legal framework;
• Proven experience in FDI projects in Serbia;

Languages and other competences:

• Fluency in Serbian and English.

DOCUMENTS TO BE INCLUDED WHEN SUBMITTING THE PROPOSALS.

Application Procedure:

Qualified and interested candidates are asked to submit their applications via UNDP Web site: UNDP in Serbia under section “Jobs” no later than 15 June 2023.

Application should include: 

• CV in English language containing date of birth, contact information (home address, phone number, e-mail) and timeline of work experience (including description of duties).  

• Offeror’s Letter confirming Interest and availability for the Individual Contractor (IC) Assignment. Can be downloaded from the following link  https://www.undp.org/sites/g/files/zskgke326/files/2022-07/confirmation.docx . The Offeror’s Letter shall include financial proposal specifying a total lump sum amount for the tasks specified in this announcement with a breakdown of costs (Offeror’s Letter, including Annex 2, Table A: Breakdown of costs & Table B: Breakdown of costs by deliverables).

In order to apply please merge above listed documents into a single PDF file. The system does not allow for more than one attachment to be uploaded.

The shortlisted candidates may be asked to provide copies of diplomas and any other certificates providing evidence of their education and experience in relevant fields.

Any request for clarification must be sent by standard electronic communication to the e-mail vacancy.rs@undp.org. The procuring UNDP entity will respond by standard electronic mail and will send response, including an explanation of the query without identifying the source of inquiry, to all consultants.

Financial Proposal

Travel 

This is home-based engagement therefore no travel envisaged under this Terms of Reference.

Evaluation

Additional Information:

• Individual Contract (IC) will be applicable for individual consultants applying in their own capacity.  If the applicant is employed by any legal entity, IC would be issued upon submission of Consent letter from the employer acknowledging the engagement with UNDP. Template of General Conditions on IC could be found on: Template of General Conditions on IC could be found on: https://www.undp.org/sites/g/files/zskgke326/files/2022-07/General_Conditions_for_Individual_Contracts.pdf 
• Reimbursable Loan Agreement (RLA) will be applicable for applicants employed by any legal entity. Template of RLA with General Terms and Conditions could be found on: https://www.undp.org/sites/g/files/zskgke326/files/2022-07/PSU_Individual%20Contract_Model%20Reimbursable%20Loan%20Agreement.docx

In the case of engagement of Civil servants under IC contract modality a no-objection letter should be provided by the Government entity. The ‘no-objection’ letter must also state that the employer formally certifies that their employees are allowed to receive short-term consultancy assignment from another entity without being on “leave-without-pay” status (if applicable), and include any conditions and restrictions on granting such permission, if any. If the previous is not applicable ‘leave-without-pay’ confirmation should be submitted.

Engagement of Government Officials and Employees

• Government Officials or Employees are civil servants of UN Member States.  As such, if they will be engaged by UNDP under an IC which they will be signing in their individual capacity (i.e., engagement is not done through RLA signed by their government employer), the following conditions must be met prior to the award of contract:

          (i)       A “No-objection” letter in respect of the individual is received from the Government employing him/her, and;

          (ii)     The individual must provide an official documentation from his/her employer formally certifying his or her status as being on “official   leave without pay” for the duration of the IC.

• The above requirements are also applicable to Government-owned and controlled enterprises and well as other semi/partially or fully owned Government entities, whether or not the Government ownership is of majority or minority status.   
• UNDP recognizes the possibility that there are situations when the Government entity employing the individual that UNDP wishes to engage is one that allows its employees to receive external short-term consultancy assignments (including but not limited to research institutions, state-owned colleges/universities, etc.), whereby a status of “on-leave-without-pay” is not required.  Under such circumstance, the individual entering into an IC with UNDP must still provide a “No-objection” letter from the Government employing him/her.  The “no objection” letter required under (i) above must also state that the employer formally certifies that their employees are allowed to receive short-term consultancy assignment from another entity without being on “leave-without-pay” status and include any conditions and restrictions on granting such permission, if any.  The said document may be obtained by, and put on record of, UNDP, in lieu of the document (ii) listed above.