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Authentic interpretation of article 25 paragraph (1)item 10) of the law on property taxes (“Official Gazette of the Republic of Macedonia” No. 61/2004, 92/2007, 102/2008, 35/11, 53/11, 84/12, 188/13, 154/15, 192/15 and 23/16)
Article 25 paragraph (1) of the Law on Property Taxes (“Official Gazette of the Republic of Macedonia” No. 61/2004, 92/2007, 102/2008, 35/11, 53/11, 84/12, 188/13, 154/15, 192/15 and 23/16), reads:
“Real estate sales tax shall not be paid:
1) for the sale of real estate in an expropriation procedure;
2) when a foreign diplomatic i.e., consular mission transfers the right to ownership of real estate, in case of reciprocity;
3) when the ownership right is transferred for the purpose of settling liabilities on the basis of public revenues in the procedure of forced collection;
4) for the sale of real estate between state bodies, between state bodies and municipalities and between municipalities;
5) for the sale of real estate in a confiscation procedure;
6) for the sale of socially owned apartments, if the sales contract does not stipulate who has the obligation to pay the tax;
7) when the right to ownership of the real estate is transferred to state bodies for the purpose of collection of claims in bankruptcy and enforcement procedures;
8) when the right to ownership of the real estate is transferred to the provider of lifelong support who in relation to the recipient of the support is in the first line of inheritance, and only for the part of the real estate which they would inherit under the Law on Inheritance without giving the support;
9) for the first sale of residential buildings and apartments carried out within a period of up to five years after the construction for which value added tax has been calculated;
10) when investing real estate in companies’ equity;
11) for trading in securities within the meaning of the Law on Securities; and
12) when the right to ownership of the real estate is transferred to the banks as creditors for the purpose of collection of claims, if they sell the acquired property within three years. ”
The provision of Article 25 paragraph (1) item 10) of the Law on Property Taxes must be interpreted in such a way so that a status change, such as acquisition, merger and division of companies whereby transfer of property (real estate) to the companies’ equity is made, shall be considered investment of real estate in the companies’ equity thus taxpayers shall be exempt from paying real estate sales tax.