Start of tax evasion campaign proves a double-edged sword

Tirana Times
By Tirana Times November 20, 2015 11:13

TIRANA, Nov. 17 – The first two months of the nationwide campaign against informality have proved a double-edged sword for the Albanian economy. After media reports that some 73,000 jobs were cut in Sept-Oct. 2015, a government transparency portal admitted massive dismissals but said the first two months of the campaign had resulted in an extra 67,000 workers, apparently lifted out of informality.

The government data indicates some 68,000 people were dismissed in Sept.-Oct. 2015.

“The campaign against informality in Sept.-Oct. 2015 produced 135,000 registered workers. The net difference between those registered and those deregistered is 67,000, a figure which compared to the average the monthly pace in the first half of this year is ten times higher,” said the government in its transparency portal.

While the government will benefit from higher social security and health insurance contributions from the previously informal workers, the social impact among 67,000 people who now find themselves jobless could be greater plunging them into poverty and further affecting consumption which has struggled to recover during this year.

Gjergj Buxhuku, the administrator of the Konfindustria business association says the situation is also a result of the situation in the country’s oil and mining sectors which have cut production and staff to cope with the sharp decline in international oil and base metal prices.

According to him, the fiscal packages the government approved in the past couple of years have further increased the tax burden in Albania and made the country less competitive in attracting foreign direct investment, which would compensate for the job cuts in the oil and mining industry and the food industry which has been affected by lower domestic consumption.

 

Tirana Times
By Tirana Times November 20, 2015 11:13