TIRANA, Jan. 7 – Starting January 2015, Albanians will pay higher taxes on non-wage income, fuel and tobacco, which are expected to cost both households and businesses an extra 112 million euros in taxes. In addition, higher electricity prices are expected to have a negative impact on the budget of both households and businesses.
While key taxes such as the personal and corporate income taxes will remain unchanged, defying businesses calls for a return to the flat tax regime after the corporate income tax was raised by 5 percent to 15 percent in 2014, the fiscal burden will further increase by raising the withholding tax on dividends and rents, increasing the circulation tax on fuel and imposing higher excise rates on tobacco.
The Albanian government plans to collect an extra 5 billion lek (Euro 35 million) from the increase by 5 percent to 15 percent on the withholding tax on dividends, interest rates on loans and deposits, income from copyright or intellectual property, games of chance as well as other rewards.
The biggest extra income is expected from the increase by 10 lek (12 lek VAT included) (Euro 0.084) in the circulation tax levied on fuel. The increase in the excise rate on tobacco is expected to bring government an extra 4.2 billion lek (Euro 30 million).
As support measures, government says it will lift the fuel and carbon tax on fuel for the fishing sector, including the already lifted excise which would reduce fuel prices by 67 lek/litre (Euro 0.47) for this industry.
Government will also lift the 20 percent VAT on compulsory non-life products dominated by auto insurance but impose a 3 percent tax on gross insurance premiums. It will also scrap the 2 percent taxes on the import of raw materials for industry and livestock such as wheat, food for livestock and lift the 10 percent customs tariff on wheat which is expected to negatively impact the state budget with 232 million lek.
