A project implemented in southeastern Albania has revealed the positive impact of introducing the security stamp as an efficient tool in improving transparency and reducing tax evasion
TIRANA, March 6 – The World Bank has urged government to work in stronger partnership with local authorities, businesses and communities to improve transparency, reduce informality and unfair competition. “The central government can use more the power of public opinion – as most countries increasingly do. It can set performance indicators for reducing informality and collecting taxes at the municipal level, make them public, and find ways to recognize good performers. It can link financial assistance to municipalities to such performance,” said World Bank country manager for Albania Kseniya Lvovsky last weekend in the southeastern town of Bilisht, Korca region, where a joint World Bank-British Council project on reducing informality was implemented by a local NGO.
Presenting the main findings and recommendations of their work, the project team highlighted the positive impact of introducing the security stamp as an efficient tool in improving transparency and reducing tax evasion, ensuring licensed and qualitative goods and services for consumers, creating a better environment for small business and fair competition, and fighting corruption.
World Bank’s Lvovsky highlighted the importance of the partnership between the regional development authority and tax department, municipal administration, and small businesses association, worth to be replicated in other regions of Albania.
Praising the project’s importance, Finance Minister Ridvan Bode said government would explore the possibility of including the security stamp in the tax procedures.
The World Bank country manager says informality rate in Albania has dropped from an estimated 30 percent in 2002 to 18 percent currently.
“Some estimates of about ten years ago put the size of informal activities in Albania at around 30% or 40% of GDP, depending on the definition. Significant progress has since been made, mainly at the central government level, as indicated by the reduction of the cash outside the bank ratio. Now, it is at 18% compared to above 30% in 2002. Yet, there is a lot of scope for improvement, and particularly at the local government level. Without further progress in this area, the state, municipalities, utilities, and other institutions that are dependent on taxes and fees, cannot improve their performance in delivering critical social services to the citizens that are expected from a European economy of the 21th century.”
“The central government can do more to promote the culture of the rule of law, in addition to promulgating the legislation, including a transparent system for paying its own obligations to the private sector,” concluded Lvovsky.
