Expected Effects on the Budget around 100 Million BAM?

12784633_1732957793607564_2102391575_nThe Tax Administration of FBiH started an initiative to amend several laws, and in order for these proposals to be implemented, the expected effect to the budget of FBiH and the cantons would amount to more than 100 million BAM.

When it comes to employment contracts, Tax Administration of FBiH considers that there is place for amends. The current situation is such that on the service contracts is paid income tax at a rate of 10 %, pension insurance (PIO) contribution is paid by the employer at the rate of 6 %, followed by health insurance contributions at the rate of 4 %, while contributions for unemployed are not paid.

Expected effects of this initiative would be increase of the tax base, to prevent the abuse of service contracts, taxpayers would be brought to the more equal position, and public revenue would be increased by more than 26 million BAM.

The following are initiatives related to payment of meal compensation and regress. According to existing regulations, compensation for meals is not taxed up to 2 % of the average salary in the FBiH per day (which amounts to about 360 BAM per month without taxes). In the inspection procedure, it has been established that there are certain abuses. Among other things, given that some people have a salary in the amount of 35,000 BAM (banking sector), regress in the amount of 24,500 BAM can be paid without taxes.

Amendments to the Law on games of chance are proposed as well, and these games are divided and taxed differently.

For games of chance or betting which are based on computer-recorded events, a flat fee will be charged in the amount of 300 BAM per each betting shop, while in the games that are based on real events (in which participants are guessing the outcomes of different sports and other events with uncertain outcome) will be paid 5 % of fee for games of chance.

Among the initiatives that the Director of the Tax Administration of FBiH Serif Isovic also mentioned are amendments to the Law on Tax Administration of FBiH, and the Law on the Unified System of Registration, Control and Collection of Contributions.




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