By Elvira Jukic
Prime Minister Nikola Spiric is optimistic that a long-overdue state budget could be adopted by the end of the year, though the core dispute between state and entities over money remains unresolved.
Bosnia’s long-overdue state budget could be adopted by the end of this year, the Prime Minister, Nikola Spiric, said on Wednesday.
The core problem in adopting the state budget for 2012, he said, lay in sharing indirect tax revenues between the state and its two autonomous entities, Republika Srpska and the Muslim-Croat Federation of Bosnia and Herzegovina.
The Prime Minister said the the two entities wanted to keep more money for themselves of the country’s indirect tax revenues.
According to the law that deals with indirect tax revenues and the way they are divided between state and entity, the state receives the amount necessary for it to function over a given financial year, and the remainder is split between the two entities.
Spiric said that the entities were not willing to compromise with state demands to increase its percentage of the revenue take in its budget plan.
The last complete state budget for Bosnia was in 2010. State institutions have functioned this year using temporary financing. The 2010 budget was 1,028,034,000 Bosnian marks, or just over half-a-billion euros.
Aleksandar Dzombic, the Republika Srpska Prime Minister, last month said his entity believed joint state institutions should get 689 million KM [344 million euros] from indirect taxes – the same as in 2009 – while the State Ministry of Finance wanted 870 million KM[435 million euros]. The Federation entity suggested that it got 780 million KM [390 milion euros].
After a session of the State Council of Ministers on Wednesday, Prime Minister Spiric said that all previous efforts to reach an agreement over the Global Fiscal Framework 2012-2014 – conditional for the adoption of next years’ budget – remained stuck over the question of entities’ demands.
Peter Sorensen, head of the EU delegation in Bosnia, held a joint informal meeting with state and entity level ministers of finance and prime ministers on December 20.
“Approaches on the current fiscal situation were discussed and no formal conclusions were made,” Andy McGuffie, spokesman of the EU delegation to Bosnia, said.
But Spiric reiterated that he was still optimistic that a compromise was getting closer.