Income from excise taxes on domestic tobacco and tobacco products in Bosnia and Herzegovina (BiH) has decreased 100 times in six years, according to data from the BiH Indirect Taxation Administration (ITA BiH).
According to the data, during the last year BiH received only about 2 million BAM from excise taxes on tobacco and tobacco products.
For example, in 2016, revenue from excise taxes on domestic tobacco and tobacco products amounted to 207 million BAM.
”Thus, in 2009, based on these excise taxes, 171 million BAMwas earned, in 2010, 216 million BAM, in 2011, 240 million BAM, in 2012, 231 million BAM, in 2013, 207 million BAM, in 2014, 203 million BAM, in 2015 233 million BAM, in 2016 207 million BAM, in 2017 190 million BAM,” it is stated in the data of the ITA of BiH.
It further states that in 2018, revenue from excise taxes on domestic tobacco and tobacco products was 119 million BAM, in 2019 it was 93 million BAM, in 2020 it was 53 million BAM, and in 2021 it was 54 million BAM.
The shutdown of tobacco factories in Banja Luka, Sarajevo and Mostar contributed the most to this.
Namely, the first of them was the shutdown of the tobacco factory in Mostar, in 2007, when around 100 workers lost their jobs. Several attempts were made to privatize this company, but without success.
After 130 years of existence, the tobacco factory in Banja Luka was shut down in 2018, and two privatizations were unsuccessful. This defunct tobacco factory was owned by the Bulgarian company Bulgartabac since 2013.
The collapse of the tobacco industry in BiH was sealed when, after more than 140 years of tradition, the tobacco factory in Sarajevo shut down last March.
This former giant employed around 3,000 workers in the 1990s, and when liquidation was announced last year, 150 workers were laid off.
Also, tobacco cultivation is slowly disappearing in BiH, and one of the few companies that has survived in this business and buys this agricultural crop from producers is the company Duvan from Bijeljina.
”My wish is to maintain tobacco production, to gradually, in agreement with the relevant ministry and local self-government, try to return that production to some values that were in previous years,” stressed Svetozar Mihajlovic, the new owner of this company.
Economist Slavisa Rakovic pointed out that this information is surprising for him, although he knows that there has been a significant drop in income from tobacco and tobacco products.
”So, we see that domestic industry is practically shut down and that is the best explanation of this indicator. If domestic industry had been maintained, not only would we have revenues from excise taxes at a much higher level, but the level of added value through processing would have been much higher, and taxes and contributions from employees’ salaries would have been significant. But what can be done… It can be expected that with such policies, we will wait for the day when it is not worth doing anything here, but to deal with politics,” concluded Rakovic.
