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The consumer

Consumer Profile
With a GDP per capita of USD 28,100 (IMF, 2021), the Slovenian consumer is the wealthiest in the Balkans (Greece included) and Eastern Europe. The Slovenian population is ageing and shrinking with youth aged 0-24 accounting for 23.85% of the total, the median age of 44.9 years and a natural growth rate of -0.03% (CIA World Factbook, 2020 and 2021 est.).
Slovenian consumer usually works long hours and has less time spend to leisure activities than the EU average. Nonetheless, labour productivity (82.7%) is also lower than the EU average (Eurostat, latest data available).
There are no significant income inequalities among different regions or social groups with Slovenia having one of the lowest Gini index in the world (23.9 out of 100 in 2019, EU average 30.7) (Eurostat, latest data available).
Consumer Behaviour
Slovenian consumer is the most affluent among Balkan nations and their spending behaviours are the closest to what can be observed in Western Europe. They are well-informed and prefer local and renowned products to foreign or unknown brands. As the purchasing power improves, the share of leisure products and services in total spending has increased.
With increased retail competition, the Slovenian consumer is becoming more demanding, however, sales service, after-sales service and customer support are rather poorly developed. Traditionally, the typical Slovenian consumer is willing to spend more on quality satisfaction for certain basic needs, education (especially for children), housing and cars than for cosmetics, jewellery and trendy outfits.
Slovenian consumers are generally accustomed to paying in monthly instalments, even for lower-cost goods.
Slovenian consumer confidence reached an all-time high at the end of 2017 with high expectations for the country's economy and the labour market. Consumer confidence remains similar to the EU and Eurozone averages.
Consumers Associations
Slovenian Consumers' Association (in Slovenian only)
Market Inspectorate (governmental body within the Ministry of Economic Development and Technology)
 

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Importing & Distributing

Import Procedures
Since its accession to the EU on 1st May 2004, Slovenia has adopted the EU Common External Tariff. Consequently, trade with Slovenia is free of customs duties when the country of origin of the goods is one of the other EU Member States.

Nevertheless, when introducing goods into Slovenia, exporters must fill in written customs declarations on a SAD (Single Administrative Document) or an Intrastat declaration. In order to import agricultural or food products, it is mandatory to pay import levies, except when a product is exempt from customs duties.

As part of the "SAFE" standards set forth by the World Customs Organisation (WCO), the European Union has set up a new system of import controls, the "Import Control System" (ICS), which aims to secure the flow of goods at the time of their entry into the customs territory of the EU. This control system, part of the Community Programme eCustoms, has been in effect since 1st January 2011. Since then, operators are required to pass an Entry Summary Declaration (ENS) to the customs of the country of entry, prior to the introduction of goods into the customs territory of the European Union.

For more information, please visit the Slovenian Customs website.

Distribution market players
Slovenian consumers are increasingly shopping at discount stores and supermarkets, leading to sales growth for industry players. In Slovenia, discounters are very popular and have a large market share.
Major industry actors include:

In other segments of the mass retail sector, Spar and Mercator are major market players. The national mass retailer Tus is losing ground, due in particular to financial problems.

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Operating a Business

Type of companies

Limited Liability Company (d.o.o)
Number of partners: One or more partners.
Capital (max/min): Minimum EUR 7,500
Shareholders and liability: Liability is limited to the amount of capital contributed.
Joint-stock company (d.d.)
Number of partners: One or more partners.
Capital (max/min): Minimum EUR 25,000
Shareholders and liability: Liability is limited to the amount of capital contributed.
General Partnership (d.n.o.)
Number of partners: Minimum 2 shareholders
Capital (max/min): No minimum capital required
Shareholders and liability: Shareholders are liable with all their assets.
Limited Partnership (k.d.)
Number of partners: Minimum 2 shareholders
Capital (max/min): No minimum capital required
Shareholders and liability: General partners are fully liable with all the assets and limited partners are not liable for the partnership obligation.
Sole trader (s.p.)
Number of partners: One individual (physical person only, no companies)
Capital (max/min): No minimum capital required
Shareholders and liability: The individual is liable with all the assets for the activities of a sole trader.
 
Setting Up a Company Slovenia Eastern Europe & Central Asia
Procedures (number) 3.0 5.3
Time (days) 8.0 11.8

Source: Doing Business - Latest available data.

 

Cost of Labour

Minimum Wage
In 2021, the minimum wage is EUR 1,024.24 per month according to Eurostat data.
Average Wage
In 2021, the monthly gross average wage is EUR 1,977.20 according to the Republic of Slovenia Statistical Office.
Social Contributions
Social Security Contributions Paid By Employers: 16.10%.
Social Security Contributions Paid By Employees: 22.10%.
 

Intellectual Property

National Organisations
The body responsible for industrial property is the SIPO, Slovenian Intellectual Property Office.
Regional Organisations
Member of European Patent Organisation (EPO) and member of Office for Harmonisation in the Internal Market of the EU (OHIM).
 

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Tax Rates

Consumption Taxes

Nature of the Tax
Value-added tax or (in Slovene): davek na dodano vrednost (DDV).
Tax Rate
22%
Reduced Tax Rate

Slovenia applies a reduced VAT rate of:

  • 5% for books and newspapers (including e-books)
  • 9.5% on certain supplies and services including foodstuffs; water supplies; pharmaceutical products; medical equipment for disabled persons; domestic passenger transport; newspapers and periodicals; cultural events and theme parks; writers and composers; social housing; renovation and repairs of private dwellings; cleaning of private dwellings; agricultural supplies; restaurants (preparation of meals only); hotel accommodation; admission to sports events; use of sports facilities; undertaker and cremation services; domestic waste collection; treatment of waste and wastewater; minor repairs of bicycles, clothes and household linen, shoes and leather goods; domestic care services; hairdressing; soft drinks; intra-community and international road passenger transport; some take away food; cut flowers and plants for decorative use and food production; certain supplies of new buildings; certain construction work for new buildings
  • exempt: real estate transactions (except “new buildings”); financial services; insurance transactions; betting, gambling and lotteries; public radio and television broadcasts; education; health care and medical services; cultural services.
Other Consumption Taxes
Alcohol and alcoholic beverages, tobacco products, mineral oils and natural gas, electricity, coal and coke are subject to excise duties.

A motor vehicle tax applies to all vehicles that are registered for the first time in Slovenia. The liability is on the entity that imports the vehicle, with rates depending on fuel range, engine power, and emission of CO2 and ranges from 0.5% to 31%. Furthermore, the government imposes an additional tax on motor vehicles with engine displacement above 2,500 cc that ranges from 0% to 16%, according to the size of the engine.

 

Corporate Taxes

Company Tax
19%
Capital Gains Taxation
Capital gains are considered as ordinary income and taxed at 19%. Gains arising from a transaction subject to the EU merger directive are exempt.
A portion equal to 47.5% of capital gains derived from the sale of shares are exempt if the shares represent a participation of at least 8% and have been held for more than six months, and at least one person is employed on a full-time basis during this period. Similarly, 50% of a loss arising on the disposal of such a shareholding would not be deductible for corporate income tax purposes.
Main Allowable Deductions and Tax Credits
Costs that occur prior to the entry of a legal entity into the court register may not be treated as tax-deductible. Expenses that are not directly necessary for performing business activities or are not incurred as a consequence of business activity are also not deductible. In general, business expenses that are necessary to generate taxable revenues are fully tax-deductible.
Companies may deduct interest expense on loans from their owners or other associated parties up to a maximum of the amount calculated by using the prescribed interest rate published by the Ministry of Finance.
Certain provisions are only 50% tax-deductible when accrued, with the remaining 50% being treated as tax-deductible when the provision is utilised, as the provisions for warranties granted when selling products or providing services, reorganisations/redundancies, anticipated losses from onerous contracts, pensions, long-service bonuses, and severance payments on retirement.

Bad debt provisions are only tax-deductible if the amount does not exceed the lower of: (i) the arithmetic mean of the bad debts written-off in the past three tax periods, under certain conditions specified in the tax law, and (ii) 1% of taxable revenues of the tax period.

Under certain conditions, a tax-deductible allowance for voluntary supplementary pension insurance may apply (of up to 24% of compulsory contributions for pension and disability insurance for insured employees, capped at EUR 2,819.01/year/employee).

Charitable donations made for humanitarian, disabled, charitable, scientific, educational, medical, sports, cultural, ecological, and religious purposes to residents of Slovenia or of EU or EEA member states are deductible, up to 0.3% of the taxable revenues, plus an additional allowance of 0.2% of the taxable revenues for payments made for cultural purposes and to voluntary organisations that work for the public interest to protect the public from natural and other disasters.
Tax losses may be carried forward to subsequent years without a limitation (but only up to a maximum of 50% of the actual tax base), whereas loss carrybacks are not permitted.

Other Corporate Taxes
Other taxes include:

  • a real estate transfer tax of 2% charged on real estate transfers and financial leases of real estate, unless VAT has been charged on the transaction;
  • a tax on financial services provided by banks and other financial institutions (the tax rate is 8.5% and is applied to the fee of the financial service);
  • an insurance premium tax levied on insurance premiums at the rate of 8.5% and paid by insurance companies;
  • an environmental tax charged on CO2 emissions, waste disposal, lubricating oils and fluids, used tyres and used motor vehicles
  • when registering for the first time a motor vehicle in Slovenia, a specific tax applies (rates may vary).

Currently, there is no specific tax levied on immovable property in Slovenia. However, a charge for the use of building land is levied on vacant and constructed building land owned by legal persons and individuals.
Social security contributions paid by the employer amount to 16.1% of the gross salary paid to employees.

Other Domestic Resources
Financial Administration Office
Consult Doing Business Website, to obtain a summary of the taxes and mandatory contributions.
 

Double Taxation Treaties

Countries With Whom a Double Taxation Treaty Have Been Signed
The list of double taxation agreements signed by Slovenia
Withholding Taxes
Dividends: 0 (paid to a resident company)/15% (paid to a non-resident company)/27.5% (paid to individuals); Interest: 0 (paid to a resident company)/15% (paid to a non-resident company)/27.5% (paid to individuals); Royalties: 0 (paid to a resident company)/15% (paid to a non-resident company)/25% (paid to individuals)
The rates may be lower in accordance with a tax treaty or with the EU parent-subsidiary directive.

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