Has the state given up on the BiH economy and entrepreneurs?!

A negative response to the initiative of the Institute for Youth Development KULT, supported by over 30,000 BiH entrepreneurs, to move the VAT payment deadline from the tenth to the last day of the month, and to reduce the daily default interest rate for late VAT payments, arrived just one month after the Chairman of the Council of Ministers of Bosnia and Herzegovina, Denis Zvizdić, publicly supported the same initiative, KULT announced, reports Patria News Agency.

In response to the parliamentary questions of state MP Saša Magazinović, it is stated, among other things, that such an initiative is not acceptable for several reasons, such as the necessity of changing legal and sub-legal acts, changes in business processes in administration, jeopardized fulfillment of the Indirect Taxation Authority's obligations to taxpayers in the form of refunds, jeopardized financing of international obligations, i.e., servicing foreign debt, costs of introducing such a VAT collection system...

Do decision-makers, when formulating such responses, take into account all the necessities faced by small BiH entrepreneurs?

We are not sure how hasty this decision of the Council of Ministers of BiH was, and how hasty the public statement of the chairman was, given that these are two completely contradictory positions.

For this reason, the Institute for Youth Development KULT insists on understanding the needs and problems of entrepreneurs, but also on the basis of the positions of institutions and government representatives on expert analyses, evidence, arguments, and facts.

We expect all involved to dedicate themselves more thoroughly to this issue, that such an important matter be the subject of public discussion, and that all decision-makers jointly find a mutually acceptable solution.

The Institute's initiative is intended for small entrepreneurs, to allow them to pay VAT on the last day of the month, while large companies would continue to pay as before, i.e., by the 10th of the month. Therefore, there was no danger of disrupting budget liquidity.

Such a practice exists in 22 European countries, as well as neighboring countries. The initiative also envisages a reduction in the default interest rate for each day of delay in VAT payment from the rate of 0.04 percent to 0.02 percent, because, as the current law dictates, small entrepreneurs take out loans to pay VAT by the 10th of the month, and paying default interest according to current provisions is more expensive than credit borrowing from commercial banks.

All proposed changes are in accordance with Council Directive 2006/112/EC of the European Union, on which the national tax legislation of European Union countries is based.

We wonder why then a tax system that is more favorable to small businesses and entrepreneurs cannot function in BiH.