Federal Prime Minister Fadil Novalic, thanks to economic growth, announced an increase in minimum wages from 406 to 700 BAM. Prior to that, the urgent adoption of the Proposal amending the Law on Contributions and the Law on Income Tax is needed so that employers can ensure wage growth. If the parliamentary procedure lasts, Bosnia and Herzegovina (BiH) is threatened by an even more mass exodus of the able-bodied population from our country.
At a time of rising prices of basic foodstuffs, these are some optimistic announcements from the Federal Government, at least for those who now receive minimum amounts.
“Aware that the minimum wage (406 BAM) is unacceptably low, we based our work on establishing a positive economic trend, ie achieving economic growth. The current economic growth of the Federation of BiH (FBiH) allows the FBiH Government to increase the minimum wage to 700 BAM and thus achieve an increase of 72.4 %. “
Employers warn that without a reduction in taxes and contributions to work, it is not possible to expect an increase in income. Otherwise, as they claim, such a decision would have a counter-effect.
“These 700 BAM announced by the Government should be clarified, whether it includes a hot meal, end-of-year bonus, transportation, all incomes that come to the worker. If that is really the case, the question is whether it is an increase in the minimum wage, because the minimum wage is 406 BAM, which with a hot meal and transportation reaches an approximate amount. If contributions are not reduced, most companies will not be able to bear this increase and it will lead to dismissal of workers, “told Suhad Eco, a member of the Board of the Association of Employers of FBiH.
Amendments to the Law on Contributions and the Law on Income Tax would lead to relieving the economy and increasing not only the minimum but also other salaries. That is why everything is up to the parliamentarians.
“If there is no reduction in levies, it is impossible to realize it because there are so many levies on employers on various forms of fiscal and parafiscal allocations that they will not be able to increase wages unless they raise the prices of their products and services, and it will mean not only inflation than that people will not even buy them anymore, ” explained Zeljko Sain, a professor at the Faculty of Economics of the University of Sarajevo.
By the previous General Collective Agreement, which ceased to be valid, the lowest hourly wage in the wood industry was 2.30 BAM. That is why, due to the non-existence of regulations, it has so far depended on employers. With the recent signing of the Collective Agreement between the Association of Employers and Trade Unions, it has increased by more than 25 percent, Federalna writes.
E.Dz.
