Decree Expired, No Minimum Wage of 1,000 BAM, Nor Fiscal Laws: Will the FBiH Government Listen to Employers?

(Patria) - The decree adopted by the FBiH Government in December 2023 on the payment of an additional non-taxable 2,520 BAM by employers to workers expired on June 30, 2024. Employers were limited to a maximum amount, but not a minimum that they must pay. Thus, some companies paid the full amount, some a portion, and some not at all, given that the decree was not binding.

The FBiH Employers' Association requested the FBiH Government to adopt a new decree under which workers could receive a non-taxable payment, given that the set of fiscal laws, as well as the law on a minimum wage of 1,000 BAM, is still not in parliamentary procedure. At the end of last year, the FBiH Government prescribed a minimum wage of 619 BAM.

Federal representative Admir Čavalić posted on X the response he received from the FBiH Tax Administration that they have no statistics on how many employers complied with this decree, as it concerns a non-taxable payment, nor are workers obliged to pay income tax.

Čavalić also submitted an initiative to adopt a new decree, with the amendment of Article 5, which prescribes that every worker has the right to the same compensation.

"In practice, this article prevented payment (a worker with 30 years of service is in the same position as one with 3 days of service).

What I expect during this month is that the FBiH Government will accept the initiative I submitted and adopt a new decree that would be valid until the end of the year. This was recently confirmed to me in a response to a parliamentary question," stated Čavalić.

Given that there are no official statistics on how many employers complied with this decree and how much workers actually felt the "employer's assistance," Čavalić notes that we must all be skeptical about any potential (lump-sum) information from the FBiH Government regarding the success of this measure.

"Furthermore, it is clear that this decree, as a temporary measure, is merely 'buying time' due to the absence of fiscal reforms. It seems there is no strategic orientation towards fiscal reforms, and decrees are used to justify things before the public and shift the ball of responsibility onto employers. Nevertheless, I have nothing against this decree; I am even initiating it because we must be pragmatic - every extra BAM for a worker in times of a drastic decline in living standards is welcome.

Understanding the (in)action at the federal level, any measure is good and is not a barrier to fiscal reforms. To simplify - if there were no decree, there would still be no fiscal reforms (which we expect this month according to the new announcements from the Prime Minister). This way, at least some workers receive a higher net amount," stated Čavalić.

One-time assistance to workers this month?

The decree on the payment of assistance by employers in the amount of 2,550 BAM was temporary in nature and lasted until June 30, 2024. That is why a month ago I submitted an initiative to adopt a new decree - hopefully for a larger amount,… pic.twitter.com/WmYIUKbAS7

— Admir Čavalić (@AdmirCavalic) July 15, 2024