prijava
SARAJEVO, December 8 (FENA) - IMF Resident Representative in BiH Andrew Jewell said in Sarajevo today that dismantling ITA would jeopardize the timely servicing of BiH’s foreign debt, which ITA currently ensures via an automatic mechanism insulated from political interference.
He said that even if the entities remained committed to servicing their obligations, the transition away from this trusted mechanism would likely weaken investor sentiment and raise borrowing costs.
Jewell stressed that, like the central bank, ITA is a pillar of the economy that has served the citizens of BiH well.
He reminded that the government of the Republika Srpska has announced its intention to withdraw from the Indirect Tax Authority (ITA) at the state level.
"Setting aside legal considerations on which the IMF is not in a position to comment, we believe this course of action would have damaging economic consequences because ITA is one of the most successful institutions in Bosnia and Herzegovina (BiH)," he said.
He added that indirect taxes collected by ITA represent the single most important source of revenues for the governments of the Federation of BiH, the Republika Srpska, and Brčko District of BiH which are used to fund schools and hospitals, build roads and highways, and pay for pensions.
"They have grown continuously in recent years, except for 2020, when the pandemic struck. With the economy now recovering, we expect ITA revenues to reach an all-time high this year," Jewell said.
He explained that if the Republika Srpska were to withdraw from ITA, this proven framework for collecting and distributing indirect taxes would be dismantled. BiH would likely return to the situation that existed before ITA was created, when tax competition between the entities and widespread tax evasion drove down revenues throughout the country.
Lower revenues would, in turn, threaten the critical services that governments currently provide.
"For all these reasons, we urge the authorities to preserve the integrity of ITA," Jewell said, the IMF Office in BiH said.
(FENA) A. B.
