The Deputy Minister of Finance and Economy Vasilika Vjero told an interview with the Albanian Telegraphic Agency (ATA) that the draft amnesty law is being discussed with the EU Delegation experts, the International Monetary Fund Mission representatives and other international partners.

Deputy Finance and Economy Minister Vjero noted that the need for more cash and state budget revenues amid the global crisis is one of the main reasons that drove government to revive this draft law.

“There are a number of reasons that have pushed the Albanian government to bring the law on fiscal amnesty back to attention. A few months ago, a wide public consultation was held regarding several initiatives, including the proposed amnesty. More than 60% of the population backed the fiscal amnesty accompanied by a legal amnesty, which would add liquidity to the state budget. The whole world is going through a difficult period, with economic growth stopping and inflation rates increasingly steadily. Albania’s inflation rate was 8%, but it could have been many times higher should the electricity price was to be increased. We expect the Albanian economy to grow by 3.2% this year,” Vjero said.

She noted that the draft law would provide more liquidity and a sigh of relief for the entrepreneurship as the proposed legislation will allow business to legalize undeclared cash and wealth.

The deputy minister, who leads the working team tasked with this process, also explained that the law clearly stipulates the mechanisms how it will be implemented.

“It is a difficult law to be implemented by the structures, so it will be followed by a series of by-laws to be implemented in the best way. The Tax Administration will be tasked with communicating with other law enforcement bodies to verify every application, both from enterprises and individuals that will apply to legalize their monetary wealth, precious stones, works of art, etc. The tax administration will oversee this process, verifying each self-declaration, as the law is based on the spirit of self-declaration, and they will be held responsible in case of false self-declaration,” Vjero added.

According to Vjero, those who want to be involved in this process will be subject to verification by the Police, Prosecutor’s Office, or the Special Anti-Crime and Anti-Corruption Prosecution Office, SPAK.

The new draft law proposes that Albania citizens living in Albania or abroad and foreigners with tax residency in Albania can declare up to two million euros in cash or property if they pay a tax of seven to ten per cent and keep the money within Albania for no less than five years.

Politicians and senior officials will not be able to participate in the amnesty scheme, or any relatives listed in their ‘family certificate’, an official document that generally include a husband, wife and their children.

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In an interview for ATA, the Deputy Minister of Finance and Economy Vasilika Vjero gave details on some of the findings as well as explained some of the proposals being discussed in two laws, that of “Income Tax” and “On tax procedures”. .

Vjero assured that the legal changes will not affect small business.  She emphasized that the government will stick to its commitment not to tax this category.

“Following the leak of salaries a few months ago, there were raised doubts regarding the level of salaries that were declared. Based on the information gathered, risk assessment and the entire range of data contained in the tax administration, but also in other institutions with which we cooperate, it was noticed that these salaries did not represent the real salary of the employees “, said Vjero.

Therefore, Vjero said, we had good reason for setting up the Anti-Informality Unit, which will be temporary.

According to her, the Unit has focused only on the level of salaries.

Deputy minister stressed that a number of taxpayers have been questioned and have admitted that part of the salary is not paid through the banking system.

“The control of individuals is delicate and the international experience considers it a bit complicated and at the moment that the Tax Administration focuses on the control of individuals, this is certainly the peak of its performance, because to control an individual you must have data from many sources such as money laundering, State Police, data from banking transactions, property, employment, inheritance, participation in shares, before being presented to the individual for interview. Many analyzes have been performed. We have an experience started a year and a half ago, where a special department has been created that should treat individuals, mainly with high incomes. We have the assistance of the IMF, where detailed risk profiles, strategies and work processes have been drafted. This is where the work of the Unit is based “, stated the deputy minister.

According to her, this is a process that takes time, but she believes that the results will be positive and will affect the correction of the behavior of individuals and employers.

Vjero also that the Unit has selected and audited 32 individuals employed mainly in the construction and insurance sector. According to her, a total of 100 individuals have been selected who will be subject to controls that the tax administration will investigate during the current year./p.s./

Vjero said that, “The mission of the Special Anti-Informality Unit is to control companies, businesses and even individuals, for the risk they pose in the declaration of liabilities, to the Tax Administration”.

According to her, “Since December 2020, the control exercised by the General Directorate of Taxes has targeted entities that clearly had under-declaration of their salaries. In total, there are 142 thousand jobs that have been analyzed by the General Directorate of Taxes or 10,533 taxpayers.

After contacting them, the General Directorate of Taxes has expected a voluntary response from these entities. Vjero made public the data of this reaction, where it turns out that 29% is the number of job positions that have declared increased salaries.

Vjero stated that, “As of January 20, 3,353 businesses have reacted positively by increasing the salaries of their employees”.

“The number of jobs with the minimum wage has decreased by 28%. 33% of taxpayers have responded positively by increasing their salary, for more than 30% of their employees. While 9194 lekë is the average salary increase for taxpayers who have reacted, while there is a 3% increase in social security contributions and 3% in health insurance “, said Vjero.

She said that 67% of taxpayers didn’t react, but maintained the same statements.

“We will continue to take measures in all categories of business in order to reduce informality in the labor market,” said Vjero. /j.p/p.s./

Deputy Minister of Economy and Finance, Vasilika Vjero said that, “the fiscal package 2022 aims at a greater mobilization of budget revenues. It is focused on two main pillars: the review of tax policies and the improvement of fiscal administration, which will increase budget revenues to ALL 5.2 billion.

Vjero announced that, “the proposed measure related to the law on Value Added Tax provides for an increase in the compensation rate of agricultural and livestock producers, from 6% to 0%”.

“The farmers will benefit from the change in the compensation rate through the self-billing scheme available for all collectors. While the revenues that we anticipate to receive from the abolition of compensation rate, will be in the amount of 750 million ALL per year,” she added.

Vjero added that, another measure is the VAT waiver for imports of machinery and equipment, which are imported and related to the investment which are equal to those larger ones worth more than 500 million. The revenues to be collected from this fiscal measure are expected to reach ALL 400 million. //a.i/