TIRANA, Dec. 15 – The high level of taxes and unfair competition are the two main obstacles faced by businesses operating in Albania, according to a survey conducted by the National Business Forum, a network bringing together some of the country’s most important business associations.
The survey with more than 400 businesses nationwide showed that the high level of taxes and unfair competition from informal businesses are the two main challenges for the business community in Albania.
The study, whose findings are published few months are a nationwide campaign to tackle rampant informality, also unveiled that paying taxes and tax inspections are the top barriers for informal business to register with authorities.
The survey also showed that businesses don’t report about one-third of their sales and staff to avoid paying higher taxes. Asked about the reasons, almost three-fourth of respondents said they were engaged in these practices because of the high tax level and corruption and among public officials.
However, two out of three respondents said they would be ready to fully comply with tax authorities if their taxes were used to finance important services and in case of tax cuts.
Experts recommend that reducing the tax burden, improving the transparency and accountability of the tax administration and the predictability of the tax legislation would help considerably improve the business climate in Albania.
Albania registered the greatest increase in the total tax rate among 189 countries in 2014 when the rate of the corporate income tax increased by 5 percent to 15 percent and the property tax doubled, according to the 2016 Paying Taxes report published by the World Bank and the PwC audit firm. The report shows Albania lost 11 places to rank 142nd with a total tax rate as a percentage of commercial profit of 36.5 percent, up from 30.7 percent in the 2015 report. The results shows Albania has one of the highest total tax rates among regional EU aspirants and lower only compared to Serbia’s 39.7 percent and Turkey’s 40.9 percent.
