IMF Representative in BiH reveals whether VAT will be increased

March 5, 2018 1:15 PM

The increase of the Value Added Tax (VAT) in BiH is not in focus, but the decrease of labour taxation will be since it is the highest in the region, said the resident representative of the International Monetary Fund (IMF) in BiH, Francisco Parodi.

When it comes to the possibility of economic growth, especially after the adoption of excises and opening of a space for large infrastructure works, Parodi noted that in comparison to the estimated growth of 2.7 % in 2017, the growth in gross domestic product (GDP) of 3.2 % can be expected in the year of 2018.

Parodi also commented the work of the Tax Administration of the FBiH in recent years, and noted that it is quite impressive. He stated that the collection of direct taxes was increased by more than 13 % in the year of 2017, which is much more than the economic growth and it clearly shows that the Tax Administration is doing its job very well.

When it comes to the EFF arrangement, Parodi noted that implementation of this program is on a satisfactory level, despite some delays regarding reforms.

Moreover, new laws on banks and banking agencies on the level of entities will help the process of modernization of the banking sector in BiH and it will make it more secure, and he added that we are still waiting for the adoption of the Law on Secured Deposits in the Parliamentary Assembly of BiH, which will complete the system.

“The adoption of the increase in excises will help in providing additional funding for Corridor 5-C, which is the largest infrastructure project in BiH, and it will lead to higher growth and employment,” stated Parodi.

He also believes that additional attention should be paid to the growth that will be led by the private sector, which is crucial for the opening of new jobs, especially for the category of young people, and it is necessary for governments to accelerate the implementation of reforms with the aim to improve business environment.







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