The workload in the Federation exceeded 41 percent. Without benefits, employers cannot increase the wages of employees. The government is working on a set of fiscal laws that could be in the parliamentary procedure by the end of the month. This would open up space for increasing the minimum wage to 1,000 BAM. Namely, the Trade Union has been insisting on this for a long time.
The cost of living is rising, and the minimum wage in the Federation is 596 BAM. Employers with the highest workload in Europe – more than 41 percent – cannot work to increase their employees’ income.
“A minimum salary of 1,000 BAM is unsustainable and it is an impossible mission in these conditions. We would have 50-60 thousand less jobs. But if we look at it in a package with a reduction in contributions, with some other incentives, it is something that could be achieved”, said Adnan Smailbegovic, president of the Association of Employers in the Federation of Bosnia and Herzegovina (FBiH).
The federal government is announcing that the set of laws from the fiscal reform will soon be submitted to the parliamentary procedure, which should enable salary increases.
“The problem is the contributions – on that 1,000 BAM, almost 700 BAM must be paid as an obligation to the state, that is, pension, social and other taxes. We are advocates of increasing the minimum wages, but reducing the contributions that go to the state”, says Zeljko Babic, president of the FBiH Chamber of Crafts.
While there is talk about the need for tax reform, the BiHworkforce is leaving, which is why workers from other countries are increasingly in demand, and BiH is threatened by the fate of Croatia, which now employs around 80,000 foreign workers. Employers see the improvement of the economic environment through the reduction of parafiscal levies, which makes it difficult to fill social funds. That is why it is necessary to expand tax bases, warn economists.
“We are the only country in Europe that does not tax dividends, and at the same time we tax the income of workers above 300 BAM. It is such a socially unjust system that it needs to be fundamentally changed. The expansion of taxation on meal allowance and thirteenth salary and other incomes that are not included in the salary today, but will be included in the salary”, says economic analyst Anto Domatet.
The incompatibility of the labor market with the education system and economic policy at the state level are only additional obstacles to the improvement of the economic environment and standards of the increasingly numerous population that seeks its existence outside BiH border.
