Study shows fiscal amnesty could legalize $6 bln of assets

TIRANA, April 26 – The implementation of a full fiscal amnesty in Albania could legalize assets worth 6 billion dollars, a preliminary study by Tirana Chamber of Commerce and Industry has recently revealed.
The amount in the case is considered hidden in the informal economy, estimated at 30 to 50 percent of the Albanian GDP. The legalization process is expected to be carried out under a modest tax of 2 to 10 percent per asset.
According to Eugenia Gjuraj, the executive director of the Tirana Chamber of Commerce and Industry, the study has been based on the contribution that different sectors have to the economy, by taking for granted an informality rate of 50 percent. The study shows the service sector would have the biggest impact if the fiscal amnesty is implemented.
“The calculation of the amount that could be generated is made possible by calculating undeclared income in years which at least should exist as capital or assets,” said Gjuraj as quoted by local media.
Meanwhile, government and businesses continue negotiations to conclude the bill expected to turn into law. The tax rate on the legalization of assets is the only point to be determined.
Finance Minister Ridvan Bode declared earlier this year that the legalization of the informal business would produce positive results for the economy, unfreezing some USD $3 billion. The process for the implementation of the fiscal amnesty will be launched and concluded this year.
The International Monetary Fund has warned that a tax amnesty should nevertheless be only considered as a last resort, as it threatens to undermine future tax compliance and the credibility of the tax system.
The opposition and some experts are also sceptical of the reform the Albanian government wants to make, considering it an effort and good opportunity to collect money in a time of crisis.