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The addenda and amendments to the Instruction “On Value Added Tax” come into force

The General Directorate of Taxes would like to inform all taxpayers that Instruction No. 5, dated 22/02/2019 “On some addenda and amendments to the Instruction No. 6, dated 30/01/2015 “On Value Added Tax in the Republic of Albania”, as amended, has been published to the Official Journal No. 23, dated 26 February 2019.

Below you can find some of the main amendments to this Instruction:

The tax rates shall be:

  • 6% for supplying advertisements service by the audio-visual media;
  • 6% for supplying public transportation means for passengers with a capacity of 9+1 seats or more, with electric motor, up to 31/12/2021. As of 01/01/2022, the tax rate shall become 10%.
  • 6% for supplying books of any kind.

For sub-contractors of the 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. For an accurate implementation of the inward processing regime procedures, the entities (whether the contractor or sub-contractor) shall refer to the letters (b) and (c) of paragraph 1 under Article 48 of the Instruction.

For farmers:

A 6% rate shall be applied to compensate them.

The following shall be added in 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.

The list of inputs and raw materials for producing drugs has been published in the DCM No. 953, dated 29/12/2014 “On the implementing provisions of the Law No. 92/2014 “On the Value Added Tax in the Republic of Albania”, as amended.