As the budget and fiscal package for 2027 is presented, the publication of draft laws prepared by the Ministry of Finance highlights changes to several key taxes that affect consumers, businesses and employees. From the reduction of VAT on basic foods to raising the taxable threshold for salaries and expanding the number of businesses that will enter the VAT scheme, these are the interventions proposed for next year.
The first change concerns VAT on food products. After years of debate, the government proposes reducing the rate from 20% to 6% for a list of basic products, which includes bread and flour, milk and natural yogurt, eggs, rice, pasta, cooking oil, meat, basic fish, fresh fruits and vegetables, legumes, sugar and basic baby foods. The detailed list of products will be determined by a decision of the Council of Ministers.
In the same article, an increase in VAT for the accommodation sector is also envisaged. The rate for five-star hotels, agrotourism and accommodation services in tourist structures is proposed to rise from 6% to 10%. Meanwhile, the general VAT rate is planned to go up to 21% from the current 20%.
Another change affects businesses. The minimum threshold for registration in the VAT scheme is proposed to be lowered from 10 million to 5 million lekë in annual turnover, or from about 100 thousand to 50 thousand euros. According to the report, this change is expected to include about 17,516 new taxpayers, who will have to apply VAT rules.
Interventions are also foreseen for the income tax on salaries. For gross salaries above 200 thousand lekë per month, the threshold from which the 23% rate applies is proposed to be raised to 300 thousand lekë. This rate will apply to salaries from 300 thousand to 700 thousand lekë, while for income above 700 thousand lekë per month, a new rate of 32% is proposed for the first time.
The package also foresees tightening the mechanisms for collecting tax liabilities, expanding the application of fines for cash transactions and a gradual increase in the excise duty on tobacco up to 2033. On the other hand, businesses are expected to be relieved of the obligation to submit financial statements twice, while the special VAT regime for the Albanian Electricity Exchange, ALPEX, is proposed to be extended until Albania joins the European Union. /TCH/