Businesses remain indifferent tax amnesty

TIRANA, July 24 – Almost two months after the renewal of a partial tax amnesty, Albania’s business community seems completely indifferent the benefits of the amnesty pardoning debts and fines until the end of 2010 in return for fees ranging from 30 to 50 percent. Nikolin Jaka, the head of the Tirana Chamber of Commerce and Industry, says no businesses have started procedures to benefit from the amnesty which remains in force until the end of 2013 because of lack of an ordinance for its implementation. In the past eight years government has adopted partial fiscal amnesties twice ahead of general elections but the business community has been indifferent fearing prosecution for false statements. Last June the majority failed to adopt a full fiscal amnesty which requires a qualified majority of 3/5 of votes. With only 67 votes by the ruling Democrats, a partial tax amnesty approved a couple of years ago was made effective again, this time until the end of 2013 but yet pardoning the same debts and fines as the 2011. Both households and businesses are given the opportunity to legalize undeclared cash at 3 three percent fees. The amnesty which was in force from May 2011 until March 2012 mostly served to individuals who revalued their property under minimum 1 percent fees, while businesses mostly ignored the amnesty fearing verification of their self-declarations by tax inspectors. Under normal conditions, the property revaluation process is made under a 10 percent tax imposed on the difference of the sale and purchase price. Under the amnesty law, businesses can have their tax and customs debts pardoned until December 2008. They have to pay 30 percent of the principal for 2009, and 50 percent of the capital for 2010 to have their fines and penalties forgiven.
Finance Ministry officials have earlier said the spirit of the amnesty is self-declaration, and businesses should be aware of this, acting in time, before the audits start. “When that happens, and the business has not self-declared things properly, and is found to be in evasion, there will be penalties,” officials had warned.
Accounting experts also justify businesses’ doubts about the advantages of declaring hidden monetary amounts and assets. The Institute of Accounting Experts says that one of the most controversial issues is the fact that the law states that if false self-declaration is identified in the future, businesses will lose their amnesty benefits.