Bosnia and Herzegovina

Bosnia and Herzegovina, a country located on the Balkan Peninsula in Southern Europe, is bordered by Croatia to the north and west, Serbia to the east, and Montenegro to the south. The official languages are Bosnian, Croatian, and Serbian.

Bosnia and Herzegovina declared sovereignty in October 1991. The country is politically decentralised and comprised of two governing entities, the Federation of Bosnia and Herzegovina (FBiH) and Republika Srpska (RS), with a third region, the Brčko District (BD), being administered by both. Its capital is Sarajevo. The konvertibilna marka (convertible mark or BAM), the national currency introduced in 1998, is pegged to the euro (EUR).

In Bosnia and Herzegovina, direct taxes are imposed on entities at the district level, while indirect tax regulations are imposed at the state level.

Bosnia and Herzegovina became a full member of the Central European Free Trade Agreement (CEFTA) in September 2007. Bosnia and Herzegovina has also signed the Stabilisation and Association Agreement (SAA) with the European Union (EU), applicable as of 1 January 2009, which brought down the customs tariff for EU products in different time periods. Bosnia and Herzegovina formally applied for EU membership on 15 February 2016 and became a potential candidate country.

Bosnia and Herzegovina is considered an upper-middle-income economy by the International Monetary Fund (IMF). The calculations made on the basis of available official indicators of the Agency for Statistics of Bosnia and Herzegovina and the entities’ statistical institutes show that the gross domestic product (GDP) for 2016 was EUR 15.83 billion (EUR 4,485 per capita). The GDP for 2017 is estimated at EUR 16.3 billion (EUR 4,616 per capita). The real GDP growth in the fourth quarter of 2017, compared to the same quarter of the previous year, amounted to 3%. According to seasonally adjusted data, GDP increased by 0.8% in the fourth quarter of 2017, as compared to the previous quarter.

PwC has been in Bosnia and Herzegovina since 1998, serving many leading clients. PwC provides audit and assurance services, advisory services, and tax services to local clients and foreign investors.