The limitations of entrepreneurship development in Bosnia and Herzegovina with special emphasis on tax regulations and procedures
Small and medium-sized enterprises account for over 99% of active businesses inBosnia and Herzegovina, and face a number of limitations when performing theirbusiness activities. A number of those limitations relate to the nature of small andmedium-sized enterprises, but most are due to the inadequate legal and regulatoryframework for doing business. A disincentivised business environment and lack ofa unified economic policy and sector strategies further complicate the position ofsmall and medium-sized enterprises. The aim of this paper is to show the limitationsfaced by these companies. To this end, an investigation involving 119 small and medium-sized enterprises in Bosnia and Herzegovina was conducted.Convenience sampling was used in the research. Based on the survey, it is evidentthat respondents rated the tax burden factor (the tax structure and taxation process)the most problematic. This finding corresponds with Doing Business’ 2019 surveyresults.A section of this paper is devoted to the fiscal aspect of doing business: tax regulationsand the overall tax burden and taxation procedures. It shows that the magnitudeof the fiscal burden, the complexity of tax regulations and the inconsistency andcomplexity of the taxation system are a significant burden on small and medium-sizedenterprises. The paper concludes with recommendations for more efficient andsimpler tax regulation.