The main changes to the Fiscal Package 2019

The General Directorate of Taxes would like to inform all taxpayers that as of 1 January 2019 the new fiscal package has entered into force.

The key legal amendments relate mainly with:

• Tax procedures
• Income tax
• Value Added Tax
• National taxes.

More specifically:

TAX PROCEDURES

• A natural person with the same personal identification number shall be registered only once by the National Business Centre. He shall be entitled to register and be equipped with a new Tax ID No./NUIS by the NBC only upon having de-registered the existing Tax ID No./NUIS.
• Those taxpayers that want to apply to the National Business Centre to go in passive status shall first have paid all the tax liabilities.
• Penalties are envisaged whether for the seller also for the purchaser, if they perform transactions with entities in the “Passive” status.
• The notification and request to pay can also be done online.
• The payment of the late payment interest is not an obligation anymore, in case of appeals/complaints.
• In case the taxpayer accepts the tax evaluation and pays the liability, the fine shall be reduced by 30%.

INCOME TAX

Tax on salaries:

0%    for the monthly gross salary up to ALL 30,000;

13%  for the monthly gross salary above ALL 30,000 – ALL 150,000;

23%  for the monthly gross salary above ALL 150,000.

Source of income: A source of income in Albania shall be also considered income of a non-resident person received due to the services performed for a resident person.

Tax on profit: Every non-resident person who is not registered pursuant to the Albanian legislation and is not subject to the Tax on Income, shall be subject to the tax on profit. The non-resident person shall prepare a declaration of taxable profits, which must be submitted by march 31^st of the next year.

Unrecognized expenses: The expenses for per diems that exceed 50% of the annual gross salary fund shall be considered as unrecognized expenses.

Tax on dividend: The tax rate of 8% shall be applied to non-allocated profits generated in 2018 and before, including reserves and capitalized profits, provided that:

• The tax related to non-allocated profits of 2017 and before is paid by 30 September 2019;
• The tax on dividend for profits of 2018 is paid by 20 August 2019.

Careful! In case of failure to abide by the above terms and conditions, the taxpayer shall pay 15% tax on dividend.

VALUE ADDED TAX

There are changes to the tax rates as follows:

• 6% for supplying advertisement services from the audio-visual media;
• 6% for supplying public transport means for passengers in vehicles with a capacity of 9+1 seats or more, with electric motor, till 31/12/2021. As of 01/01/2022 the tax rate shall become 10%.
• 6% for supplying books of any kind.

Sub-contractors of inward processing regime: A tax rate of 0% shall be applied for supplying services to process non-Albanian goods with a destination to be re-exported, by authorized taxable persons and their sub-contractors, pursuant to the provisions of the Customs Code related to the operations under inward processing regime.

The rate of farmers compensation: The rate of 6% shall be applied for compensating farmers.

Exemptions from VAT: The following shall be added to the list of exemptions from VAT:

• Supply of agricultural vehicles;
• Supply of agricultural inputs;
• Supply of vet services, excluding those for home pets;
• Import of raw materials used for production of drugs.

NATIONAL TAXES

• The tax on plastic materials/items and plastic packaging imported, at the amount of 35 ALL/kg, excluding raw materials in primary condition.
• The tax of glass packaging on packaging imported and manufactured domestically, at the amount of 5 ALL/kg
• The tax of raw materials in primary condition imported and used for domestic manufacturing of plastic products, at the amount of 25 ALL/kg