Deputy Prime Minister of the Federation of Bosnia and Herzegovina (FBiH), Vojin Mijatovic, announced key developments in fiscal reform and income legislation, emphasizing the Federation’s commitment to adopting a new regulatory framework for fiscal policy. Mijatovic expressed optimism that these changes could eliminate the black market in the FBiH.

“When the amendments to the Income Tax Law in the Federation are adopted, we will follow with a decree on the minimum monthly wages for workers in FBiH,” Mijatovic stated, adding that, starting January 1, 2025, no employer will be able to pay less than 1,200 Bosnian marks (some €600), depending on the final stipulations of the adopted amendments. “We are ensuring the long-promised minimum wage and addressing the social gap,” he said.

Mijatovic also addressed the government’s borrowing policy, explaining that it aligns with the Federation’s Debt Plan previously established under Prime Minister Fadil Novalic’s administration.

Following the entity government session, Deputy Prime Minister and Minister of Finance Toni Kraljevic spoke about the Draft Law on Fiscalization of Transactions, emphasizing its goal to curb tax evasion, reduce the informal market, and prevent unfair competition. “If you are fiscally compliant, but your competitor is not, they can undercut you, which creates unfair competition,” Kraljevic noted.

He highlighted the importance of educating consumers on fiscal responsibility, retaining receipts, and improving tax monitoring procedures. The law introduces an electronic data-logging system, the Central Fiscalization Platform, managed by the FBiH Tax Administration, which will act as a central hub for all fiscal data from electronic systems, enhancing oversight and preventing tax evasion.

Kraljevic also pointed out upcoming amendments to the Income Tax Law, which would allow employers to reward employees with untaxed income. The legislation, expected to be temporary from January 1 to December 31, 2025, aims to alleviate tax burdens and is part of a broader tax reform initiated by the Federation government.

In addition, the Finance Minister reassured that pensioners would not be affected by the budget adoption process. Funds have already been accumulated from savings to provide a one-time financial assistance payment for pensioners, bypassing any delays due to budgetary constraints.

Reflecting on the outdated 2009 Fiscal System Law, Kraljevic remarked on the necessity of updating the legal framework to match technological advancements. “Looking back over the last 15 years, it’s evident how much the current legal framework has struggled to keep pace with technological developments,” he noted, adding that fiscal reform is now a priority for the current government. While the reform is complex and phased, this marks the beginning of a transformative fiscal overhaul for the Federation of Bosnia and Herzegovina.