Milićević: First measures to mitigate economic impact are forthcoming

SARAJEVO, (Patria) - The Federal Ministry of Finance is already preparing amendments to the Rulebook on the application of the Income Tax Law in accordance with the recommendations adopted by the Government of the Federation of BiH on Monday, which aim to mitigate the consequences of the coronavirus outbreak on the economy.

The Deputy Prime Minister of the Federation of BiH and Minister of Finance, Jelka Milićević, stated that work is underway to prepare materials that should be published in the Official Gazette of the Federation of BiH as soon as possible.

"This is only part of the first set of measures to mitigate the consequences on the economy. The second part relates to the reprogramming of credit obligations of legal and natural persons and the formation of favorable credit lines for current operations. This amendment to the Rulebook on the application of the Income Tax Law is currently within the jurisdiction of the Ministry of Finance, and we are already preparing activities, i.e., incentive measures, for certain categories of people. Primarily, these are craftsmen who pay income tax on a lump-sum basis," explained the Minister.

The amendment will involve adding a new paragraph to Article 50 of the aforementioned rulebook, specifically reducing the income amount paid by these taxpayers on a lump-sum basis by 50 percent.

This means that taxpayers engaged in crafts and related activities, without employing other persons, will pay BAM 35 instead of the current BAM 70 in lump-sum income tax. Taxpayers engaged in old and traditional crafts will pay BAM 15 instead of BAM 30. Taxpayers engaged in passenger transport with a single vehicle will pay BAM 25 instead of BAM 50. Taxpayers engaged in freight transport with a single vehicle with a load capacity of up to eight tons will pay BAM 40 instead of BAM 80 in lump-sum income tax. Taxpayers engaged in retail trade through personal work outside of a store will pay BAM 35 instead of BAM 70.

This reduction is intended to be temporary and will be valid from the date the amendments to the Rulebook come into force until the end of this year.

In addition to this measure, all taxpayers are invited to contact the Tax Administration of the FBiH with a request for a reduction in advance payments of profit tax, in accordance with Article 52, paragraph 4 of the Profit Tax Law.

"With these measures, we want to protect those most exposed to market disruptions and, in a way, share the burden and obligations with them," said Minister Milićević.