VAT on machinery imports to be lifted

TIRANA, April 10 – Government is planning to remove the value added tax for imports of machinery and equipment and merge the national council of business and labour into a single body as part of efforts to improve the business climate and increase Albania’s competitiveness.
Under current law, importers of machinery and equipment can pay VAT within a two-year deadline from their import date.
“Machinery, equipment, spare parts” were Albania’s top imports in 2011, increasing by 24 percent to 110 billion lek, according to INSTAT data. However, during the first two months of 2012, imports of this category suffered a 3 percent drop, unveiling the curb for new investments as both consumer and business confidence have dropped to a record low.
Speaking in this week’s meeting of the regulatory task force, Prime Minister Sali Berisha said government will also increase transparency over public procurements by publishing a list of winning companies every six months and making available online even the minority views of the complaints examination commission.
“This task force represents a new effort to create a better business environment, because the dynamism of the Albanian economy has to be adapted to the pace of the global economy. Bureaucracy is the top enemy of this development, and that’s why it has to be constantly fought so that its tentacles do not hinder business,” said Prime Minister Sali Berisha.
Few weeks ago, the regulatory task force led by the Prime Minister decided to take several measures cutting the number of procedures and time for business licences and permits in an effort to further improve business climate in Albania. The task force said the number of business registration procedures will be cut from 5 to 2 while the registration cost lower to 100 lek (USD 1) from Lek 112 currently.
Construction permit procedures in Tirana will also significantly be cut from 24 to 5 and time needed from a record 436 days to only 40.
The electricity supply procedures are also expected to be cut from 6 to 4 and time reduced to 45 days from 177 days currently. The real estate registration procedures will also be cut to 3 and time needed to 13 days from 33 days currently.
Employers are also expected to face lower social security contribution rates from the removal of reference wages. Businesses engaged in exports will also need only 3 documents and five days for their activities.
“Domestic and foreign investors are showing rising interest to invest in Albania and the reduction of bureaucratic burden is becoming more and more necessary,” said Berisha, adding that the measures would improve Albania’s rank in the Global Competitiveness Index, which is a key indicator for potential foreign investors.