Albania: Albania changes its VAT legislation

International Tax Review is part of Legal Benchmarking Limited, 1-2 Paris Garden, London, SE1 8ND

Copyright © Legal Benchmarking Limited and its affiliated companies 2025

Accessibility | Terms of Use | Privacy Policy | Modern Slavery Statement

Albania: Albania changes its VAT legislation

ndreka.jpg

Dorina Asllani Ndreka

VAT is the most important tax in Albania. According to the fiscal indicators regarding the consolidated budget, VAT is expected to amount to 8.5% of GDP for the 2014 fiscal year. VAT is levied on all supplies of goods and services in Albania, and for all imports. The VAT rate in Albania was 20% for the majority of supplies of services and goods, and until now a reduced rate of 10% was levied on the supply of medications and medical services.

The Law on Valued Added Tax provides some specific goods and services that are exempted from VAT. Some of these exempted supplies include: financial services; supply and rental of land; granting, negotiating, administration and securing of money credits; bank transactions, money transfers, loans, cheques, with the exception of debt collection services; transactions dealing with money, bills, and other legal means of payment; transactions regarding shares, capital, bonds, securities, etc; administration of investment funds; non-profit organisations; supply of casinos, hippodromes and gambling; postal services and exports.

With the Law no.182/2013, dated December 28 2013, the Parliament adopted several changes regarding the VAT, which entered into force from January 1 2014.

In accordance with these changes, medicinal drugs and health services supplied by public or private medical institutions are no longer subject to 10% VAT, but are instead considered as exempted supply. The changes are not to be strictly applicable from the beginning of the new 2014 financial year, but will rather be effective as of April 1 2014, to give the Ministry of Finance the possibility to arrange the administration of the already existing supplies.

VAT refunding has been one of the less applicable legal rights regarding this tax, which was until now legally granted but practically denied to the taxpayers. To help both taxpayers and the law enforcement, the new law defines a simplified procedure and accelerated deadlines regarding refunding, with the scope of making it more applicable in practice. Starting from January 1 2014, the Fiscal Regional Directory is to control and approve as refundable the taxpayer's credit balance within 60 days of the taxpayer's application. The payment of the VAT refundable credit balance is performed by the treasury system, in accordance with the rules and procedures defined in the Guideline of the Ministry of Finances, which remains to be published.

Dorina Asllani Ndreka (dorina.asllani@eurofast.eu)

Eurofast Global, Tirana Office

Tel: +355 42 248 548

Website: www.eurofast.eu

more across site & shared bottom lb ros

More from across our site

DLA Piper’s co-head of tax for the US and Latin America tells ITR about her fervent belief in equal access to the law, loving yoga, and paternal inspirations
Tax expert Craig Hillier agrees with the comparison of pillar two to using a sledgehammer to crack a nut
The amount is reported to be up 57% from the £5.6bn that the UK tax agency believes was underpaid in the previous year
The US president also unveiled a new 50% levy on copper imports; in other news, a UK wealth tax proposal has been criticised by the Institute for Fiscal Studies
Wim Wuyts, who had been head of the specialist tax network since 2017, is moving on to a new role with WTS’s Belgian member firm
MNEs are increasingly using algorithmic tools in TP. Sahasranshu Dash argues that data ethics should therefore plug directly into the TP design process
The Institute of Chartered Accountants in England and Wales also queried whether HMRC resources could be better spent scrutinising larger entities
Grant Thornton’s Austria tax head likens his practice to an escape room, shares his football coaching ambitions, and explains why tax is cool
Awards
ITR is delighted to reveal all the shortlisted nominees for the 2025 EMEA Tax Awards
Awards
ITR is delighted to reveal all the shortlisted nominees for the 2025 Asia-Pacific Tax Awards
Gift this article