For many years, there has been a fiscalization system regulated by the Law on Fiscal Systems in place, which was adopted in 2009 and implemented since 2010/2011 and is still in force. A fiscal reform, with new fiscal devices, the expansion of entities that will be obligated to issue fiscal receipts, and the introduction of electronic invoices as a completely new segment, is planned and currently in preparatory stages. To improve and expand the scope of fiscalization, the FBIH Government created a Draft Law on Fiscalization of Financial Transactions with several novelties and technological improvements, which Draft, when it becomes a proposal and then a new Law on Fiscalization, is planned to replace the existing Law on Fiscal Systems that governs the fiscalization area. This means that the new system of fiscalization will be based on new rules, an improved transaction monitoring system, a wider range of taxpayers, and new fiscal devices, among other changes.

Currently, the aforementioned draft of the new law is in the parliamentary procedure (that is, still in the adoption process with possible changes and amendments), and in the coming period, sometime at the beginning of 2025, it is expected that the details will be known and that the process of adopting the new law will be fully completed. In the Draft Law itself, several innovations are foreseen, from the new central system of the Tax Administration through new fiscal devices to the introduction of electronic invoices as a new type of document altogether, alongside new rules for fiscal receipts, new elements on the fiscal receipts, and so on.

After the adoption of the law, the adoption of the first by-laws is expected to follow. According to the provisions of the draft, a deadline of 3 months from the adoption of this law is foreseen to adopt the rulebook on the dynamics of fiscalization, that is, to determine the first official deadlines for adapting to the new system and transitioning to the new fiscalization. Currently, there is no expected deadline or information on when this rulebook, in which we will know more about the deadlines and transition, can be expected. The unknowns are understandable considering that the focus is on the adoption of the legal text first and, if necessary, amendments to the existing text during the adoption process before bylaws are introduced.

According to the government, the limitations of the existing legal framework are reflected in the fragmentation of reporting, that is, the mismatch of transactions recorded according to the current legal framework of fiscal systems about transactions that are subject to VAT. The same inconsistency applies to persons who are liable for fiscalization, i.e., subject to transaction reporting. Further fragmentation is reflected in the incompleteness of data on reported transactions, which prevents risk analysis and control by the Tax Administration.

The new legal framework proposes that every transaction must be documented either through fiscal receipts or invoices, and all transactions should be reported to the Tax Administration. The new law also foresees the delivery of data on fiscal transactions in real-time as well as data on each transaction as a type of complete and timely reporting on business operations. Full reporting of transactions brings significant benefits through increased tax discipline, improvement of control methods, and more efficient activities of the Tax Administration in the aspect of tax collection control.

More details are expected in the upcoming period, such as the first information on the expected adoption of the text of the Draft Law and then the first deadlines for the transition to the new system with the method of preparation of the subjects involved, which are not published yet.