Panel: Slovenia Needs to Reform Tax System

Ljubljana, 25 May

Slovenia needs to reform its tax system in order to provide fresh impetus for development, participants of Wednesday's panel on strengthening Slovenia's competitiveness in the EU underscored.

According to the business officials, academics and politicians on hand for the panel sponsored by President Janez Drnovsek, Slovenia lags behind the rest of the EU in terms of production of high-technology goods. Moreover, it creates fewer new jobs than the EU on average.
In his address, Drnovsek said the country must "improve the business climate, connect science with business and get fully involved in the Lisbon process". He said one of the reasons for the country's decreasing competitive strength was that it was closed to foreigners.
According to Drnovsek, things have not changed much after Slovenia's EU entry, which might be due to the fact that Slovenia held elections last, which is typically a period of little change. The time has come now to move forward, Drnovsek stressed.
Prime Minister Janez Jansa meanwhile identified entry into the eurozone and the Schengen area as Slovenia's key priorities.
Marjan Senjur of the Ljubljana Faculty of Economics said Slovenia did not need radical reforms such as a flat tax rate.
Senjur, a former minister of economic relations and development, stressed that the progressive tax system must be scaled back somewhat but that the changes must be widely accepted by the public.
A flat tax rate would be acceptable if it aided in lifting the burden on businesses, chairman of home appliance group Gorenje Franjo Bobinac said.
Meanwhile, entrepreneur Ivo Boscarol, who sits on the Strategic Council for Economic Development, which advises the government on economic matters, reiterated his belief that the flat tax rate is the best option for Slovenia at the moment.
Touching on other reforms needed to be made by Slovenia, Marko Jaklic of the Ljubljana Faculty of Economics said the state must continue to privatise state-owned enterprises.
Moreover, the government must make sure that individual measures of economic policy are harmonised and do not have counterproductive effects.
According to Janez Sustersic of the Institute for Macroeconomic Analysis and Development (IMAD), Slovenia can realise its dream of being a prosperous nation with balanced social and environmental development.
"The steps that Slovenia needs to take are set out in the reformed draft of the Development Strategy...Its main points are deregulation and liberalisation, as well as more flexible labour legislation and wide social dialogue," Sustersic said.

Panel: Slovenia Needs to Reform Tax System

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