Unconfirmed census results cannot be used for distribution of tax revenue

An IMF delegation held a meeting with the cantonal Minister of Finance Jasmin Halebić, during which disagreement was expressed with the practice of using preliminary census results for the purpose of distributing indirect tax revenue, before the final results are published, writes the Bosnian news agency Patria.

We remind that Minister of Finance Jelka Milićević (HDZ BiH), by using the preliminary results of the Population Census, reduced the coefficients for the distribution of public revenue. Compared to the earlier period, the coefficients were reduced, thereby reducing the annual revenue for the Sarajevo Canton by 5.5 million marks, the Bosnian-Podrinje Canton by 3.5 million, the Tuzla Canton by 6.8 million, and the Zenica-Doboj Canton by approximately 4.3 million KM.

Halebić informed the delegation about the difficult situation of public finances in the Sarajevo Canton, given the high accumulated deficit, which in 2015 amounted to more than 13 percent of the Sarajevo Canton budget, and the further deterioration of the fiscal situation due to enforceable court rulings in labor relations.

The meeting also discussed the drafting of the Law on the Allocation of Public Revenues in the Federation of BiH, the adoption of which was announced by the Federal Government for 2016. Minister Halebić suggested to the representatives of the IMF and the Federal Ministry of Finance that the optimal solution for the new Law on the Allocation of Public Revenues should take into account the volume of indirect tax payments by individual cantons. Such an approach would replace the current static demographic-geographic criteria with dynamic economic criteria. In addition, the indirect effect of such an approach would certainly be the suppression of the gray economy in the Federation of BiH.