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With the aim of reducing the outflow of labor, which has been a chronic problem for a long time, the Government of the Federation of BiH adopted the Decision on the Minimum Wage for 2025 in the amount of 1,000 KM at yesterdays session. This is a significant increase in the minimum wage that has multiple significant positive effects because it primarily ensures a higher standard for workers with the lowest incomes.
We are absolutely aware that such a decision raises numerous questions and challenges, especially for employers in terms of predictable and sustainable business, but the long-term positive effects will certainly outweigh the initial difficulties. All partners of the Federation Government in the Economic and Social Council are very concerned about the lack of labor and the departure of qualified workers, and this measure, in addition to easing the pressure due to the rising cost of living, will have an impact on reducing the outflow of people and strengthening the economic stability of the country - said the Deputy Prime Minister of the Federation of BiH and Federal Minister of Finance Toni Kraljevic.
Minister Kraljevic emphasizes that it should be kept in mind that the increase of the minimum wage is not and will not be an isolated move but part of a comprehensive strategy for the reform of the fiscal system, and that this decision of the FBiH Government should be viewed in that context. We remain determined and aware of the need to reduce the sum of the contribution rate with the aim of relieving the economy and increasing competitiveness - said Minister Kraljevic.
Otherwise, in the context of the increase of the minimum wage and its impact on low-accumulative activities, it should be pointed out that the current law on contributions enables benefits for employers who pay wages from these sectors in the amount of up to 85 percent of the average net wage to whom the basis for contributions is significantly lower and the same amount of 0.3 of the average gross wage for the first nine months of 2024. Accordingly, low-accumulative activities will not be affected by the governments decision to increase the minimum wage.
In order to ensure better adaptation to the new conditions, and to facilitate the implementation of the decision by employers through various types of subsidies without reducing the number of jobs, the FBiH Government has postponed the adoption of the 2025 budget. It should also be recalled that through previous interventions, the Government has proactively acted to open up space for employers to increase workers salaries by introducing various types of non-taxable benefits.
In this sense, we remain open to a joint dialogue with all partners in order to find the best solutions that will primarily ensure an increase in workers standards as well as greater economic growth - the Government of the Federation of BiH explained to the Federal News Agency.
