Bosnia Tightens Controls Over Boom in Rental Apartments

Renting out apartments for a day has become a popular way for Bosnians to making extra profit but the unclear laws in this area are seen as causing a problem for the state budget.

Now a new law, adopted three months, intends to clear up the confusion. It allows Bosnians to rent out a property without registering as a rental company.

But they must also register the apartment or house they are offering for rent and pay a 10 per cent tax on any income earned.

"The law was not clear when it came to renting out apartments in this way but with the new law, adopted three months ago, we hope to have this situation under control," Dusanka Makivic, from the inspectorate of Republika Srpska, told BIRN.

One problem is that authority over this field has been divided in Bosnia between the two entities, Republika Srpska and the Federation of Bosnia.

The RS Inspectorate has meanwhile checked up on a random 30 apartments and found out that, while in nine cases everything was in order, and while 15 were in the process of registration, six had to stop working.

Other problems are that the RS Inspectorate lacks inspectors, and the huge number of rental apartments to be found over the internet.

"We can track those who advertise via the internet, and there is a large number of them, but our inspectors cannot enter private apartments without a court order," Makivic noted.

"The tax administration keeps no special records on those who rent out apartments in this way, but they should be paying 10 per cent in tax from the total income earned," Nikola Salapura, from the Tax Administration of Republika Srpska, explained.

The situation in Bosnia's Federation entity is similar, where the Inspectorate could not provide detailed information on...