Hi,
I come from the region ( former Yugoslavia). Montenegro (Serbian: Crna Gora or "black mountain") used to be one of the six constituent republics. Along with Macedonia and Kosovo, it was a recipient of federal subsidies at the time due to an economic underdevelopment. Today, Montenegro is a republic in the State Union of Serbia and Montenegro. Most governmental authority of the union is in hands of each republic.
Most Montenegrins regard themselves as the Serbs, or at least they used to. However, as you can see today, the republic is divided into two factions; Montenegrins who still consider themselves as the Serbs and Montenegrins who claim to be separate nation and even went as far as to rename Serbian language Montenegrin. The referendum on independence is scheduled for 21 May and a lot of issues depend upon it. One thing is for sure; whatever the outcome, present position of Montenegro will be over.
However, since this is not political forum, I will give you some pieces of information regarding economy, tax and so on.
In Montenegro, every company has been at least partially privatized, with more than 55% of state ownership transferred into the hands of the private investors. Montenegrin Government adopted the Privatization Plan in April 2000. Four methods for privatization have been proposed: Mass voucher privatization-MVP (29%), international tenders (40%), Batch sale (4%) and Auctions (8%). Through Mass Voucher Privatization (MVP) process 15 foreign financial companies entered Montenegro. All domestic financial institutions participated in the process and several were founded in order to contribute to capital market development (Security Commission of Montenegro, Central Depositary Agency, Central Register, the second stock exchange, 4 brokerage houses, 6 Privatization Funds). Thus MVP process was considered to be successful. Almost 400.000 citizens became Montenegrin companies owners.
A foreign person may, alone or with another foreign and/or domestic person:
establish a wholly-owned enterprise
invest capital in an already existing enterprise
set up a branch of its own enterprise
found or invest in insuarance oganizations, banks, and other financial organization, and free zones
invest in the form of leasing, franchising, management contract and the purchase of real-estate
B.O.T. - build, operate and transfer
establish a representative office
be granted a concession
Economic growth stands at 4.1 %, rate of unemployment is roughly about 20 %.
The standard VAT rate is 17 %, there are reduced rates of 7% and 0%.
The VAT is charged on sale of goods and services, as well as on imports to Montenegro.
The rate of 7% is paid on basic products for human consumption (milk, bread etc), medicines, books, services of accomodation, services of public transportation...
Purchase tax in Montenegro is payable on transfer of ownership of real property, land. The tax of 2 % is imposed on buyer.
Property prices in Montenegro are about 30-40 % lower than in neighbouring Croatia. As you mentioned Budva, I will give you a rough guide. For one bed apartment (40 m2) you pay about 40-50 thousand Euro.
As I said, a lot of it depends on the outcome of referendum. The worst possible scenario would be if number of votes for independence is in region 50-55 %, which would mean a victory for "independence faction", yet they would not be able to declare independence, since the EU suggested that the threshold had to be 55%. That could trigger off a political as well as a legal stalemate, so to say uncertain future.
Thanks