TIRANA, Jan. 5 – Italy says it has lifted a discriminatory tax on Albanian transports in force since the late 1950s which has been severely affecting Albanian exports to the neighboring Adriatic country since Albania’s transition to a market economy in the early 1990s. The solution to this long-standing dispute with the top trading partner was confirmed by Italian Prime Minister Matteo Renzi during a visit to Tirana on Dec. 30.
In a joint press conference with Renzi, Albanian Prime Minister Edi Rama announced that starting from early 2015 the absurd tax affecting Albania’s transports to Italy would be reduced to the normal levels that all truck drivers pay for transports to Italy.
The National Chamber of Garment and Footwear producers, which is the top exporter to Italy, hailed the decision, saying that it would benefit 500 Albanian enterprises.
The decision will cut transportation costs to Italy by Euro 6.2 per tonne, said the Chamber.
The discriminatory tax had been placed since 1959 and was applied only for Albania, Syria and Iran.
The Albanian Association of International Transport estimated that each Albanian truck transporting to Italy was overcharged around 250 to 300 euros from the Cold War tax which charged Albanian transport vehicles for a fixed 120 days despite staying in Italy for an average of one week.
Italy is Albania’s top trade partner with 50 percent of total exports and 30 percent of imports. More than 80 percent of footwear and garment products manufactured in Albania, which are the country’s main exports, go to Italy. According to Italy’s Confindustria lobby group, some 300 Italian companies operate in Albania, mainly in the footwear and garment manufacturing.
Government officials say Albania offers investment opportunities not only because of the flexibility of its labour market and its low fiscal regimes, but also because of the tangible assistance to domestic and foreign investors.
Italy is also one of the top foreign investors in Albania with investments in key sectors such as energy, banking, health, education and construction.
Living with a fiscal burden of 15 percent is just a one-hour flight from Italy. That’s how a headline published in Italy’s daily Il Giornale recently described Albania this week comparing it to Italy which applies a 31.4 percent corporate income rate. The Italian daily describes Albania as an attractive destination where some 20,000 Italians have already invested.
