Albanian authorities must
secure parliamentary approval to bring about much-needed improvements to the
country's tax regime, the International Monetary Fund (IMF) has said in its
latest Article IV consultation for the country.
The report said that the country's tax
administration is "inefficient" and the development of a new property
tax system has been delayed until 2017.
It noted that tax revenues, particularly
value-added tax revenues, have been impacted by lower-than-expected oil prices
and consumption and by inflation.
The country's 2017 Budget seeks to raise
oil-related revenues, broaden the base for the circulation tax on luxury cars,
reduce exemptions, and introduce pilot projects to improve its current
area-based property tax, the report said. Albania also plans to increase
cigarette excises starting in 2018, to gradually meet EU levels. The
authorities have also committed to address the increasing stock of VAT credits.
The IMF called on Albania to streamline
VAT exemptions for imports of machinery and equipment, and refrain from
announcing any tax amnesties or new tax exemptions or preferences without prior
consultation with the Fund.
Albanian Minister of Finance Arben
Ahmetaj has declared recently that after general elections there will be a new
program in place with International Monetary Fund (IMF).
"Currently there is a joint instrument
approved by the Board, an instrument that monitors the government on all
commitments made throughout 2017. We switch over to a new relation with IMF,
which is monitoring after the arrangement, a close cooperation with IMF, while
after elections it is the incoming government's target to decide on a fresh
program," he said at a press conference.