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Amendments to the Act on Value Added Tax

Tax news, May 2017

The Act on Amendment to the Value Added Tax Act (“Act”) was published in the “Official Gazette of BiH”, number 33/17 on 9 May 2017.

The Act enters into force on 17 May 2017 and applies as of the application date of the bylaw regulated within the Article 208 of the Customs Policy Act of Bosnia and Herzegovina, i.e. as of the application date of the bylaw regulating conditions and procedure on exercising the right to exemption from import duties payment, which is not adopted yet.

The Act adjusts the Article 26 Point 2 of the Value Added Tax Act (“Official Gazette of BiH”, number 9/05, 35/05 and 100/08) with the Customs Policy Act of Bosnia and Herzegovina (“Official Gazette of BiH”, number 58/15).

Exemption from import VAT shall not apply to following goods exempt from customs duties:

1) equipment representing an investment by a foreign person, except for passenger vehicles, entertainment and slot machines,

2) equipment for production which is not produced in BiH, imported for new production or expansion of existing production, its modernization, introduction of new or upgrading of the existing production technology, and used for purposes of carrying out direct production activity,

3) goods for military and police forces and penitentiary institutions, completely financed by donors,

4) goods used for demining,

5) goods for projects of rebuilding and reconstruction of Bosnia and Herzegovina, if the project is adopted by the Council of Ministers of BiH and completely financed by foreign donors or mostly financed by foreign donors or international developments banks and less financed from the budget,

6) equipment for civil protection and fire protection institutions intended to be used for protection and rescue of civilian population.

As published in our Tax Alert from July 2015, new Customs Policy Act of BiH expanded the list of goods exempt from import duties, which also relates to import VAT, in comparison to previously applicable Customs Policy Act.

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Samir Hadžić
Manager
Tax & Legal Practice
T: +387 (0)33 277 560
M: +387 (0)61 796 067
shadzic@deloittece.com

Emir Ibišević
Senior Manager
Tax, Legal & BPS Services
T: +387 (0)33 277 560
M: : +387 61 396 047
eibisevic@deloittece.com
 

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