Electricity prices for non-household consumers, first half 2019
(EUR per kWh)
Source: Eurostat (online data codes: nrg_pc_205)
LABOR COSTS IN THE REPUBLIC OF SRPSKA
The Republic of Srpska has lowest gross salary in the region, the lowest rate of taxes and contribution to gross salaries and skillful workforce. Gross salaries in the Republic of Srpska consist of net salary, income taxes and mandatory contributions for pension and disability benefits insurance, health insurance, child protection and unemployment insurance. The employer is also obliged to suspend the solidarity contribution from the employee’s net salary in the corresponding amount and pay it to one of the prescribed public revenue accounts.
The employee’s salary includes the basic salary, increases prescribed by the Labor Law (increase of 0.3% for each year of service), income tax and mandatory contributions. Other increases in the basic salary may be based on work performance, difficult working conditions, overtime work, work at night, and on the basis of work on holidays and other days that are non-working days by law.
The lowest net salary in the Republic of Srpska was determined by the Decision on the lowest salary in the Republic of Srpska is 332.34 €. The lowest salary paid to a worker is increased on the basis of length of service, and work on public holidays and night work.
According to the law, every taxpayer of personal income tax is entitled to a basic personal deduction (reduction of the tax base) with the amount of 6,135.50 € per year, ie. on a monthly basis, that reduction amounts to 511.29 €. Gross income exceeding 511.29 € per month will be taxed at the rate of 8%.
The table below displays the calculation of income (the basis is the average gross wage paid in December 2021):
EXPLANATION
The basis for the calculation of contributions is the Gross monthly salary.
Contributions = Gross monthly salary * 31%
Tax base = Gross monthly salary – Personal deduction – Deduction by tax card
Income tax = Tax base * Income tax of 8%
Personal deduction = 6,135.50 € per year/12 months
Deductions In the formation of the Tax base:
1. Basic deduction of in the amount of 6,135.50 per year,
2. Personal deduction for dependent members of the immediate family in the amount of 920.32 € per year for each dependent member (based on the tax card obtained from the Tax Administration of the Republic of Srpska, at personal request),
3. Personal deduction based on the basis of interest for a housing loan (based on a tax card obtained from the Tax Administration of the Republic of Srpska, at personal request).
The table below displays the cumulative rate of mandatory contributions in the Republic of Srpska:
The table below displays a comparison of the cumulative contributions rate with neighboring countries for 2022:
The table below displays average gross salary in the Republic of Srpska by sections for 2017-2021:
Source: Republic of Srpska Institute of Statistics (2021.)
INCENTIVES TO INCREASE EMPLOYEESˈ WAGES
The legal regulations provide an incentive for employers to increase the wages of employees
Beneficiaries of incentives for employee wage increases can only be business entities whose main activity is production, trade or service. The business entity has the right to an incentive individually per employee, in the amount corresponding to the value of 70% of the paid contributions to increase the employee’s wage.
The wage increase represents the difference between the amount of the employee’s increased wage and the initial amount of the employee’s wage (the initial amount for determining the employee’s wage increase is the amount of the employee’s wage for December in the calendar year, which precedes the calculation period for which the incentive request is submitted). It is necessary that the initial amount of the employee’s wage is equal to or higher than the lowest wage in the Republic of Srpska and that in the calculation period the employee has a higher amount of wage in relation to the initial amount of wage.
The amount of individual incentive per employee cannot be higher than BAM 1,000.00 (€511.33) in the accounting period (there are two accounting periods, one of which lasts from January 1 to June 30, and the other from July 1 to December 31 in one calendar year). Exceptionally, when a business entity whose main activity is the production of textiles, clothing, leather and leather products for employees whose starting wage is lower than the average gross wage in the Republic of Srpska for the previous year (according to the data of the Republic Institute of Statistics), increases the wage above that average gross wage when calculating incentives, the paid contributions to the increased wage are determined as the difference between the paid contributions to the increased wage and the amount of contributions paid to the lowest wage in the Republic of Srpska in the accounting period for which the incentive is requested.
The request for an incentive to increase the employees’ wages shall be submitted by business entities to the Ministry of Economy and Entrepreneurship of the Republic of Srpska, no later than 60 days from the day of expiration of the accounting period for which the incentive is requested.
The Government of the Republic of Srpska, through the Employment Bureau of the Republic of Srpska, provides subsidies for the recruiting of new employees, as well as training, retraining and additional training and improving the mobility of employees. Also, local self-government units provide subsidies for the recruiting of new employees in accordance with their development policies.
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