The official data from the Social Insurance Institute confirm that the number of contributors to the social insurance scheme has increased by 168,000 persons only in the non-agricultural private sector for the period 2013-2016, but this increase is not reflected in personal income tax revenues (TAP).
Actually, during this year the inflows from this tax have marked a drop of 4 percent compared to the previous year.
The Ministry of Finance reported in the five-month fiscal indicators that TAP revenues during January-March 2017 reached at Lek 12.9 billion from Lek 134 billion in the same period of 2016 with a 3.8 percent decline.
TAP revenues performed much lower than other voices of revenues. For the five-month period 2017, revenues from taxes and customs increased by 7.6%, while TAP revenues fell by almost 4%.
According to the detailed tax data for 2016, the main weight in the TAP collection was occupied by the income from the private sector salary, with 35% of the total, followed by wages in the state sector, with almost 20%, tax on other income at source, by about 15%; from rents about 12%; from interest rates 9%, etc.
Accountants explain that there is currently a big difference between taxation of the high-paid individuals and small-business, which is driving a tax evasion scheme, as high-paying individuals are registering as small businesses, thus billing companies where they work in order to avoid personal income tax, which up to 23% for high salaries.
By 2014 tax on salaries and other personal income was 10 percent for all levels. After this year with the political rotation, the Personal Income Tax (TAP) turned progressive.
From zero to 30 thousand lek TAP is zero, from 30,001 to 130 thousand lek is 13% of the amount and for 30 thousand lek salaries to 130,001 lek is 23% of the amount.