Social security contributions paid by the employer and the employee

Social security contributions paid by the employer and the employee

In Republic of Srpska as well as in the Federation of B&H, contributions are calculated on the basis of gross wage. Gross wage includes net wage earned by regular employment, multiplied by determined coefficient, plus contributions from wage.

a) Employer’s share:
- FB&H:17% for pension insurance, 12.5% for health insurance, 1.5% for unemployment insurance (in total: 31% on gross wage).
- RS: 18,5% for pension insurance, 10,2% for health insurance, 0,6% for unemployment insurance, 1,7% for child protection (in total: 31% on gross wage)
- Brcko District: 17% for pension insurance for employers who apply FB&H law and 18,5% for pension insurance for employers who apply RS law, 12% for health insurance, 1,5% for unemployment insurance (in total: 32% on gross wage).

b) Employee’s share:
- FB&H: 2,5% for pension insurance, 2% for health insurance, 0.50% for unemployment insurance (in total: 5% on gross wage).
- RS: no such contributions are paid.
- Brcko District: 6% on gross wage for pension insurance for employers who apply FB&H law.

Testimonials & Success Stories
 

Global Investment Promotion Best Practices 2012 of the World Bank has cited one example of support that FIPA provides to foreign investors who are running business in Bosnia and Herzegovina in order to contribute to increase the flow of foreign capital in the country.

The article said:  

„The Foreign Investment Promotion Agency (FIPA) of Bosnia and Herzegovina was an early convert to the idea of providing facilitation services to agribusiness investors as a way to maximize the positive impact of agriculture on the economy.

In 2007, for example, FIPA assisted a Dutch food processing company establish a US$1.6 million production facility to process unused milk ingredients into value-added products in Sarajevo to sell to markets in Eastern Europe and the Middle East.

As part of its aftercare program, FIPA assisted the company with its expansion plans. Among other things, the agency helped facilitate veterinary permissions, navigate various bureaucratic hurdles and played an important role in securing funding for the company’s expansion. It also helped develop a network of local suppliers and customers. As a result of these efforts, the Dutch investor developed stronger links with the Bosnian economy, thus increasing the positive spillover effects on the local economy.

Currently a new investment to establish a drying facility for milk powder is under way. This will further expand the processing facilities of unused milk ingredients. This additional planned investment is worth approximately US$2.8 million, thus nearly trebling the company’s original investment in the country“.

 

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