Taxes and Fees
The main taxation categories are:
- Value added tax (17%)
- Profit tax (10%)
- Income tax (10%)
- Property tax (10%)
- Contributions for social insurance paid by the employer and the employee,
- Excise taxes are a special type of taxes charged on some products, such as oil derivatives, tobacco products, non-alcohol beverages, beer, wine, and coffee.
Calculation of profit tax
Profit is calculated under applicable legislation by subtracting expenditures from revenues. The tax basis includes profit, revenues and capital gain in accordance with accounting regulations. Calculation of expenditures have to be in accordance with accounting standards.
Income tax in the RS is 10% of the net salary (in accordance with the gross model).
Foreign nationals and taxes in BiH and the RS
All foreign nationals with residence in BiH and the RS pay tax on income earned in a calendar year in the territory of BiH. Also, all foreign nationals who don't reside in BiH but earn income in the RS are considered taxpayers.
The gain transferred from other countries is not taxable if it is taxable in the country of origin.
The summary rate of contributions is 33% of the gross salary, of which:
- 18.5% accounts for pension and disability insurance,
- 12% accounts for health insurance,
- 1.5% accounts for child protection,
- 1% accounts for unemployment insurance.
Monetary policy in is formulated, adopted, and controlled by the Central Bank of Bosnia and Herzegovina that manages the policy through the Currency Board arrangement.
The currency of BiH is convertible mark (BAM) and it is pegged to Euro (1 BAM = 0.51129 Euro).