Skopje, 24th July 2015 (MIA) – Proposed extension of the preferential VAT rate up to the end of 2018, as regards the construction and the first sale of flats is a support to the construction sector, thus creating conditions for further expansion of the construction of residential buildings, Deputy Prime Minister and Minister of Finance, Zoran Stavreski said.

 Stavreski expects for the proposed amendments to the Law on VAT, being under parliamentary procedure, to be adopted by the end of this month. Thus, as he said, the Government meets the requirement of the Construction Chamber in order to encourage the further construction of flats.

–  Government had a good ear for this request, giving proposal for 5% preferential rate to be applied on the construction of flats and the first sale of flats for another three years, i.e. by the end of 2018, which will provide for both further expansion of the construction of residential buildings and maintaining lower prices of flats, if the VAT general rate amounts to 18%, a measure supported by the Government, Stavreski said during his visit to the Macedonian Chambers of Commerce.

Government measure, as Stavreski pointed out, was introduced in 2009 resulting in significant increase in construction of flats throughout Macedonia. – Prior to adopting this measure, around 600 to 700 flats were built per year, rising to between 1,700 and 1,800 built housing units on annual basis. Second benefit of this measure is the fact that, in the meantime, it was also accompanied by other measures undertaken to the end of supporting the construction companies to reduce the average price of flats. If few years ago, it amounted to EUR 950 per square meter in Skopje, today, it amounts to EUR 850 per square meter, while as for the smaller towns in the Republic of Macedonia, these prices are lower by EUR 100, Stavreski said.

On the demand side, as Minister of Finance underlined, the Government helps the citizens under the “Buy a House, Buy a Flat” Project, by providing subsidies to those deciding to buy their own home.

– Given the so-far EUR 3.8 million as Government subsides, housing loans in the amount of EUR 20 million have been extended, helping 620 families to resolve their housing issue. We remain open to cooperation with the Construction Chamber and the Macedonian Chambers of Commerce in order to provide good conditions for construction companies, by giving Government support thereto, Stavreski said.

According to Robert Hot, President of the Construction Chamber within the Macedonian Chambers of Commerce, the construction companies believe that the government measure will provide for stable growth and continuation of their work. This, as he stressed, is significant for another 26 branches growing along with the construction companies.  

In addition to the construction of buildings, as Hot said, the stable policy as regards the capital investments contributes to resuming stable growth of the construction sector as regards the civil engineering construction, by building highways, regional and high-speed roads in the next three to four years.

– This cooperation will continue in future as we also negotiate with other Ministries, whereby we will jointly contribute to eliminating the unfair competition, Hot said.

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