The increased annual turnover threshold from 80 million to 140 million lek and the reduced 5 percent profit tax down from a previous 15 percent rate being applied for this category of business since January 1 will provide a fresh impetus to the modernization and business expanding efforts. Small business companies can now take a leap to another level thanks to their expanding activity as a result of the threefold decrease of the profit tax rate that will enable businesses to invest more in technology, knowhow and increase their workforce. Prime Minister Edi Rama visited today one of the most promising businesses in this aspect.
“Our company manufactures aluminum and plastic windows and doors. We export our products to Italy, Germany and Switzerland. Over the past year, we have been largely investing in cutting-edge technology and machineries to increase manufacturing speed and continue manufacturing high-quality products. The machineries are all brand new ones and they help us a lot to improve quality. Our company is one of the few ones to enter the European markets,” a company manager said.
“The 5 percent profit tax rate being applied now will help us a lot. We look forward to growing faster now as we have grown gradually to date. The government’s fiscal incentives will help our business a lot. The cut in profit tax will allow us to invest more and hire a large number of workers,” the company representative said.
Prime Minister Edi Rama noted that small companies should now take advantage to earn the big business status as the five percent profit tax rate applied for around 91 percent of the business operators in Albania is the lowest in the whole region.
“The threefold tax cut is a great incentive as the remaining 10 percent rate will now be used to support investments, business growth and employment. Of course, should you strengthen further and your annual turnover and profits also grow, then you will pay a 15 percent profit tax as we want you to grow constantly and become big businesses. We have succeeded in applying the lowest tax rate in the region. Around 91 percent of the companies with an annual turnover of 140 million lek will now pay a five percent profit tax rate only. No other country in the region applies such a low tax rate. The measure will promote employment and self-employment. We couldn’t afford it earlier due to the constraints we faced, but by providing more opportunities, we believe that increasing the annual turnover threshold from 80 million to 140 million lek will help businesses to embark on a modernizing and sophistication process,” the Premier said.
The Minister of Finance and Economy Arben Ahmetaj noted that a series of incentives and components had helped this typical small business operator to grow further and keep growing in order to gain the big business status in a near future.
“The Albanian Investment Development Agency (AIDA) has helped this small business to certify. The certification has allowed them to start exporting and grow further and their goal is not to be classified as a small business with the turnover threshold of 140 million lek. The company should aim for the small industrialization we have already included in our government’s program. Practically this are a small impulse of that industrialization,” Ahmetaj said.
Just like every other company, this business is finding it hard and complains about the lack of skilled workers. “We are finding it really hard to get skilled workers, but we will keep trying. We hire our unskilled workers and try to train them then,” the company representative said.
“We have launched a new employment scheme,” the Premier said, adding: “The new scheme will become available to companies for training programs so that you can somehow compensate for the lack of this skilled workforce, because you should pay if you are to hire an unskilled worker, while it also takes a lot of time to train him and make him fit for the job. This is really a very serious problem as a large number of jobs are on offer by every company across the country, but there is a lack of the skilled workforce to take up these jobs. The universities have been overcrowded for years, creating a serious deficiency in the area of the vocational education. The big turn has already started over the past few years.”
Economy and Finance Minister Arben Ahmetaj said that more than 20 000 jobseekers and students will be trained to learn and gain specific technical skills, also to manoeuvre machineries and he invited this business to cooperate with the National Labour Service under this training programme.
