development report 2012 - UMAR

52 Development Report 2012
Development by the priorities of SDS – An efficient and less costly state
economic crisis and partly due to the said transition from
the controlled state aids. In 2010, de minimis aid was
reduced, but stood at a high level of EUR 60.7 million,
accounting for 13.2% of state aid. It was allocated for
different purposes, mainly for employment and SMEs.
Also here, there is a high rate of concentration since in the
period 2009–2010 only 1.7% of recipients (237) 131 were
granted 27.5% of total de minimis aid. The remaining
98.3% (13,364) of recipients were allocated aids that
on average amounted only to EUR 7,157. By degree of
concentration, the de minimis aid does not differ from
the state aid. An excessive number of recipients being
allocated small de minimis aid amounts leads to high
administration and transaction costs; consequently,
their number should be reduced and the amount of
the aid limited to a reasonable extent which brings
positive effects in accordance with the objectives of their
allocation.
The overall burden of taxes and contributions measured
as a share of GDP during SDS’s implementation
remained below the EU average, but it did record an
upward trend 132 . In 2010 it was by 1.3 p.p. of GDP lower
than the EU average, but compared to the previous year’s
level it increased by 0.4 p.p. of GDP. A share of social
security contributions grew by 0.2 p.p. of GDP reaching
the peak value after 2000. The share of tax revenues
remained steady and, compared to the previous year,
it even increased. The increase was to a large extent
due to a rise in the share of taxes on production and on
imports, which grew as a result of reduced economic
activity following the increase in excise duties and
value added tax mainly on imports, which was also a
response to a rise in prices of oil and raw materials. For
the third year in a row, the share of taxes on income and
property recorded a downward trend, where – given the
poor macroeconomic picture – revenues on income tax
decreased, as well as the revenues on corporate income
tax following the reduction of tax rates and changes to
the reliefs. Taxes on capital increased slightly in 2010
in nominal terms, however, in the structure, their share
is irrelevant. The burden of taxes and contributions in
Slovenia in 2009 was by 0.6 p.p. of GDP lower than in 2005,
which was largely owing to the reduction of burdens in
the period 2006–2008; in the last two years, however, the
burden has again increased following a significant fall in
GDP since the onset of the crisis.
In Slovenia, the above-average tax burden is imposed
on labour and consumption, while the burden on
capital is below the average. The implicit tax rate 133 on
consumption in 2009 amounted to 24.2% in Slovenia,
whereas the EU average was 20.9%. Only seven Member
States, with a predominance of the Nordic countries,
131
This includes only the recipients that were granted more than
EUR 100,000 in the period 2009–2010.
132
The increase was also a result of a high fall in GDP in 2009 and
its modest increase in 2010.
133
The implicit tax rate on consumption is defined as a
ratio between taxes on consumption and final household
consumption in a country's territory in compliance with the
reported higher rates. After 2003, the tax rate on
consumption saw a downward trend in Slovenia, while
the average for European countries rose. The implicit tax
rate on labour in Slovenia stood at 34.9% in 2009 and
was higher than the EU average (32.9%) on account
of relatively high social security contributions. Twelve
Member States reported higher rates than Slovenia.
The implicit tax rate on capital for Slovenia is estimated
at 21.0% 134 for 2009 and is below the EU-25 135 average
(24.6%). Seven Member States, including the Czech
Republic, Hungary, Poland and Slovakia, reported lower
rates.
3.2. Institutional competitiveness
The year 2011 did not see any withdrawal of the state
from direct and indirect ownership in companies and
financial institutions. The reasons remain unchanged.
First and foremost, the government lacked a sound
strategy and policy as to its ownership in companies and
financial institutions. The 2011–2015 Strategy for the
Management of the Capital Investments of the Republic
of Slovenia, prepared by the Capital Assets Management
Agency of the Republic of Slovenia (AUKN), was not
adopted; as a result, there was no formal basis for the
decision-making on the withdrawal of the state from
company ownership. In this vacuum a desire to maintain
and sometimes even increase the state ownership in the
economy prevailed. Second, the financial and economic
crisis reduces the interest of portfolio and strategic
investors in acquiring ownership shares in companies.
Third, compulsory settlements and bankruptcies of
companies actually forced state-owned banks to swap
loans for ownership shares in these companies.
With the establishment of the AUKN in 2010, this
agency assumed responsibility for the management
of state-owned assets and became a key decision
maker on the policy on privatisation of companies. In
2011, the AUKN prepared 2011–2015 Strategy for the
Management of the Capital Investments of the Republic
of Slovenia, which was to provide a basis for all decisions
on the withdrawal of the state from company ownership.
The strategy divides state’s stakes in companies
into strategic and portfolio investments 136 ; strategic
national accounts methodology. The implicit tax rate on
labour is defined as the ratio between taxes on labour and
the compensation of employees increased by payroll tax, in
compliance with the national accounts methodology.
134
Taxes on income and on other types of capital (e.g. property)
are low in Slovenia.
135
No data for EU-27.
136
Strategic capital investments are investments with which
the Republic of Slovenia aims to achieve, in addition to
economic goals, also infrastructural and other goals linked
to the performance of individual public services, as well as to
development and other goals. Portfolio capital investments
are investments with which the Republic of Slovenia aims to
achieve exclusively economic goals and with which the AUKN
disposes independently.