Albania Scraps Profit Tax for Small Businesses

TIRANA, July 16

Starting 1 January 2021small businesses with an annual turnover that does not exceed Lek 14 million will be exempt from simplified tax profit. Currently, the tax rate on taxable profit for small businesses with an annual turnover between Lek five million and Lek eight million that are subject to simple income tax is five percent. Meanwhile, only businesses with an annual turnover up to Lek five million are exempt from profit tax.
The government adopted the changes on the bill ‘On income Tax’ during its latest meeting, Monitor Magazine reported on Wednesday.
According to the changes to the bill, businesses with an annual turnover that exceeds Lek 14 million are subject to a 15percent income tax rate.
Based on official data from the Institute of Statistics, over 94,000 businesses active in 2018 employed up to four people. Almost 80 percent of those businesses declared an annual turnover below Lek five million. Hence, the recent verdict is not expected to have an impact on the budget.

Source: Monitor, tatime.gov