The "Excise" Mission: How Sarajlić Collapsed the Budget and Endangered Disability Benefits!

The budget of the Federation of BiH is in big trouble after the law introducing a tax on the sale of cut tobacco failed in the BiH House of Peoples last week, the BiH news agency Patria (NAP) has learned from sources close to the government of Nermin Nikšić.

As we learn, the payment of April salaries to budget users will definitely be delayed, and depending on the inflow of funds into the budget, the fate of disability benefits for the veteran population will be clear! Behind the entire scandal, as we learn, are lobbying and internal party conflicts at the expense of citizens and the BiH economy, which largely depends on budget stability. 

- There is no talk of paying subsidies and other transfers from the budget in this situation – a source from the FBiH Government told us. The federal Minister of Finance, Ante Krajina, also spoke about this earlier, but the background of the story revealed by Patria agency was not known.

Namely, the Law on Excise Duties on Cut Tobacco was agreed upon with the International Monetary Fund (IMF), and its adoption would unblock the sixth tranche of the loan, from which the Federation was supposed to receive about 80 million marks. The IMF confirmed that as soon as the introduction of excise duties was postponed, they could not conclude the sixth review of the stand-by arrangement, and thus could not disburse the next tranche.

- The situation in the budget is alarming, and this effectively postpones every transfer from the IMF until after the elections. It is questionable how the Federation will function in the coming period – our source states.

And the law, the adoption of which was first agreed upon at the BiH Fiscal Council, then at the BiH Council of Ministers and the House of Representatives, was supposed to introduce an excise duty on the sale of cut tobacco, thereby increasing state revenues. Tobacco producers and the tobacco industry were, understandably, against the law. However, the authorities seemed determined to fulfill the obligation agreed upon with the IMF.

There was an agreement among all political actors on the adoption of this law until it reached the BiH House of Peoples, where the initiative to consider it under an urgent procedure was unexpectedly rejected. This effectively rejected it for a longer period and postponed the IMF tranche.

According to Patria (NAP) agency sources close to the FBiH Government, Asim Sarajlić, head of the SDA Club in the House of Representatives of the BiH Parliament, played a key role in rejecting this law, lobbying for a negative stance from SDA and SDP delegates. It is interesting that the delegates of these parties were against it, even though their parties form the FBiH Government, which seeks the adoption of the law and the regulation of that market.

Probably unaware of the consequences that the postponement of the adoption of this law could cause, the delegates from these two parties "fell" for Sarajlić's lobbying out of "supra-party interests" and postponed the adoption of the law, thus bringing the Federation's budget into a difficult situation and prolonging the existing disarray of the cut tobacco market, reports NAP.

As we learn, the FBiH Government will consider the newly created situation and budget crisis at tomorrow's session.