Montenegro’s Tax Administration imposed almost €1.78mn in penalties during intensified inspections of businesses operating through the tourism season.
Between 1 May and 30 July, tax inspectors carried out 2,096 controls across the country. Irregularities were identified at 343 taxpayers, resulting in 512 penalty notices with a combined value of €1,781,750.
Temporary operating bans were imposed on 34 businesses.
The inspections have focused on sectors where summer revenue is concentrated, including hospitality, accommodation, retail and other services operating in coastal tourism centres. Authorities are paying particular attention to fiscal receipts, revenue registration and undeclared workers.
The figures show both the scale of enforcement and the persistence of informal activity. Montenegro’s tourism economy includes major hotels and professionally managed companies, but it also depends on thousands of small restaurants, bars, shops, apartment operators and seasonal service providers.
For compliant businesses, informal competition creates a direct commercial disadvantage. A company that records all revenue, pays employment contributions and complies with labour rules faces higher operating costs than a competitor concealing cash income or employing unregistered staff.
Stronger enforcement can therefore improve market conditions for operators that follow the rules. It can also increase budget revenue during the months when economic activity is at its highest.
The number of penalties compared with inspections indicates that irregularities were found in a significant minority of cases, although the majority of inspected taxpayers were not reported as non-compliant.
Temporary closures carry a particularly strong commercial effect during peak season. Losing several operating days in July or August can cost a hospitality business more than the formal fine, while public closure notices may damage its reputation.
Tax enforcement nevertheless needs to distinguish between deliberate evasion and minor administrative errors. Small seasonal businesses often struggle with frequent staff changes, foreign-worker documentation and complex reporting requirements.
A system based only on penalties can encourage further informality where businesses perceive compliance as too difficult. Digital tools, advance guidance and consistent interpretation of rules are therefore as important as inspections.
The results also raise questions about private accommodation. Official tourism statistics exclude much of the activity in individually rented apartments and houses, while the scale of the sector makes it an important area for tax administration and destination planning.
Revenue that remains outside official channels affects more than the budget. It makes tourism performance harder to measure, complicates infrastructure planning and reduces the reliability of data used by investors and municipalities.
The €1.78mn penalty total sends a strong enforcement signal, but the longer-term objective is a tourism market in which formal compliance becomes the standard commercial model rather than a risk assessed only when inspectors arrive.
