Small business in Albania is no longer subject to profit tax, VAT and field inspections, giving a fresh breath to their daily activity. This is evidenced by many small business operators in the city of Vlora, which, despite the COVID-19 restrictions, have succeeded thanks to the government incentives and measures designed to soften the blow of the pandemic to businesses all over the country.
Prime Minister Edi Rama today visited a number of businesses in the southern coastal city, with the business owners acknowledging that despite a very tough law amid the restriction measures, not only did they survive, but they are now seeking ways to improve and boost their businesses and enhance their workers’ salaries.
“Business has performed very well since the very beginning, although our expectations were running low because of the pandemic. However, everything has gone just fine. This is also thanks to your assistance and support. The government granted us the wartime salary during the pandemic and you are now further helping us by scraping the profit tax on small businesses. With the profit tax removed, we will be able to expand business and increase our workers’ salaries. We are really grateful,” a young entrepreneur said.
Tax inspectors will no longer conduct field inspections at small business operators, avoiding this way any potential abuse with business and to the Premier this is one of the most important aspects of the government’s measure. “We have considered it an essential aspect of the decision to scrap profit tax and VAT on small businesses. The move will also spare businesses from any kind of pressure from tax inspectors. This is the most important aspect, because you know it pretty well that, according to us, although the majority of them do their job correctly, it takes just a few number of unfair inspectors for every of your efforts to be wasted. The decision will allow businesses to breath freely throughout the year. So, I really hope that with the decision now into force, you will be completely free in your business activity,” the Premier said, also putting emphasis on the need for fairness and correct law enforcement also when it comes to the employer‑employee relationship. “I am looking forward to seeing many workers see their monthly salaries gradually increase. The regular payment of the salaries will be certainly monitored, the registered employees, the social and health insurance contributions. These are aspects we don’t tolerate.”
The Directorate of the Tax Administration Delina Ibrahimaj noted that the government measures to support business aim at making tax administration assume the role of the business supporter and consultant. “We want business to see tax administration as an institution that provides assistance and consultancy. Tax administration will largely focus on office work so that business is no longer monitored physically by deploying inspectors, but the process is carried out remotely from office and therefore businesses will see tax administration as an institution that provides assistance, because the better the business performs, the better we perform in collecting tax revenues. This is the whole idea behind the small business support policy,” she said.
Businessmen admit that removal of the profit tax on small businesses is the best move to support business this season. “We all faced a tough season, yet I think we all coped with it successfully. We hope for a better season next year and fully recover. We have received the wartime salary since May,” a businessman said.
A total of 5800 businesses in the city of Vlora are eligible to benefit under the government’s decision to scrap the profit tax on small businesses with an annual turnover up to 14 million lek and VAT on businesses with turnover up to 100 million lek. “We started with small businesses with annual turnover of 80 million, by halving the previous 10% tax rate to only five percent. The measure was then expanded to apply to businesses with annual turnover 120 million lek. The measure now applies to businesses with annual turnover of 140 million lek. Small businesses with annual turnover of 100 million lek will also be excluded from VAT. While to 140 million, without taxes, but with VAT. But the most important thing to say beyond this, is that you will get rid of any checks, inspections, bills, etc. Inspectors will monitor only respect for the employees, payment of social security, health insurance contributions. You will definitely have that account box at the fiscalization stage and this is will be made to check big businesses,” PM Rama said as he explained the government decision during visit to a small business in Vlora.
Businessmen also praised the ongoing projects that are transforming the southern coastal city and will definitely attract a larger number of both local and international visitors.
