Bosnia and Herzegovina Tax Rates
Bosnia and Herzegovina has a complex governance structure with two entities (Federation of Bosnia and Herzegovina and Republika Srpska) and the Brčko District, each with separate tax systems. The country features a flat 10% income tax across all entities, a 10% corporate tax, and a 17% standard VAT (the only tax collected at the state level). This low-tax environment reflects the country's developing economy and EU integration aspirations.
Top Income Tax Rate
10%
Corporate Tax Rate
10%
VAT / Sales Tax
17%
Capital Gains Tax
10%
Detailed Tax Information
Income Tax Brackets
Both entities (FBiH and RS) and the Brčko District apply a flat 10% income tax. Personal allowances differ between entities. In the FBiH, a personal deduction of BAM 3,600/year applies. In Republika Srpska, a personal deduction of BAM 6,000/year applies. Employment, self-employment, and investment income are all taxed at 10%.
| Income Range | Tax Rate |
|---|---|
| KM 0+ | 10% |
Corporate Tax
Both entities levy corporate income tax at 10%. Republika Srpska offers additional incentives for investment in underdeveloped municipalities. Free zones offer tax reductions for qualifying businesses.
Standard Rate
10%
Capital Gains Tax
Capital gains are taxed at the flat 10% rate. Rules differ slightly between entities. Real estate and securities gains are both subject to this tax.
Rate
10%
VAT / Sales Tax
BiH applies a single VAT rate of 17% with no reduced rates (only zero-rating for exports and certain essentials). VAT is the only state-level tax, collected by the Indirect Tax Authority and redistributed to entities.
Standard Rate
17%
Cryptocurrency Tax
Cryptocurrency gains are taxed under general income tax rules at 10%. BiH has very limited specific crypto regulation.
Tax Treaties
Bosnia and Herzegovina has approximately 40 double taxation treaties. The treaty network is growing as part of EU integration efforts.
Treaty Network
40
Double taxation agreements
Major treaty partners:
Key Details
Relocate to Bosnia and Herzegovina
See how much you could save by moving here from your current country.
$-16,638
Tax in United States
$24K
24.4% effective
Tax in Bosnia and Herzegovina
$41K
41% effective
Additional Cost
68.3%
more tax annually
US Citizens: Important Note
US citizens are taxed on worldwide income regardless of residence. You'll still need to file US taxes, though the Foreign Earned Income Exclusion and Foreign Tax Credit may reduce your liability.
