DF: Adoption of the Profit Tax Law Eliminates the Last Export Incentive Measure

The essence of the adopted profit tax law, which was voted for by representatives of the SDA, SBB and HDZ BiH in the Federal Parliament is the abolition of the only incentive measure for our exporters, it was announced from the Democratic Front, reports the Bosnian news agency Patria.

Unfortunately, the Government of the Federation of Bosnia and Herzegovina does not know, or does not want to know, that there are other possibilities for subsidies and tax exemptions, which are aimed at helping companies with innovation and development, new employment, reinvestment, and the adoption of environmental standards in production. Other countries that have joined the EU first designed and implemented these incentive activities for companies, and only then abolished export incentives. In the past twenty years, insufficient work has been done on this front, leaving our economy uncompetitive and at the bottom of Europe. Instead of the Government proposing laws that would first create opportunities to help the domestic economy and exporters, in line with the EU standards they invoke, the Government first abolishes export incentives.

On the other hand, the Government's explanation states that this law aims to reduce the grey economy, which is not true, because the grey economy has nothing to do with this form of taxation. The adoption of this proposal for a corporate profit tax law will also lead to an increase in layoffs and the spread of anarchy in the labour market, because we have articles of the law that will lead to that, such as Article 37 of the aforementioned Law.

Given that the current Federal Government constantly repeats that its goal is economic growth and employment, the DF Caucus in the House of Representatives of the Parliament of the Federation of Bosnia and Herzegovina also offered an amendment to the proposed Law (a newly established legal entity in economically underdeveloped municipalities in the Federation of Bosnia and Herzegovina, which performs a production activity, is exempt from paying profit tax for the first three years from the start of performing the activity, on the profit generated by performing the activity in the underdeveloped municipality. A taxpayer who generates profit in a newly established business unit, which performs a production activity in underdeveloped municipalities, is granted a reduction in profit tax for a period of three years proportional to the share of such profit in the total profit of the taxpayer), which can stimulate the much-needed growth of production and employment, as well as the much-needed more balanced economic development of all areas.  

The Federal Government, for who knows how many times now, rejects in advance the constructive solutions coming from the opposition, but that is primarily their choice, in their already continuous and recognisable style of arrogant governance.

The SDA, HDZ BiH and SBB particularly humiliated the Employers' Association of the Federation of Bosnia and Herzegovina, which duly submitted their request to address the Parliament according to the Rules of Procedure, but the ruling coalition prohibited them from doing so.