The Ministry of Economy and Finance of the Republic of Albania has announced its intention to revise the methodology for calculating the tax on residential real estate in the Balkan country. Officials have begun working on a new draft of amendments to the tax legislation, which is expected to be ready in 2023.
What will change? The new project is not aimed at changing the tax rate, which is 0.05% of the value of the asset, but at revising the tax base used in calculating the amount to be paid (the cost of an apartment, cottage or other immovable property).
Currently, the average fiscal reference prices per square meter are used to determine the tax base, as defined in Annex 1 to Resolution No. 132 "On the methodology for determining the taxable value of real estate". In the annex to the said Resolution, the average reference prices for the sale and purchase of buildings used for residential purposes are determined by cities, and for Tirana, prices are divided by 32 cadastral districts.
The purpose of officials is to organize taxation using the market value of assets. Changes in the tax calculation base, in particular, are aimed at bringing the level of taxation in line with current prices, which often differ greatly from average prices. For example, significant differences are observed in the case of premium new buildings in many areas of the capital Tirana.
Context. According to the financial stability report of the Central Bank of Albania (Bankës së Shqipërisë), apartment prices in the whole country in the period from January to June 2022 increased by 28.4% compared to the previous six-month period and by 39% compared to the same period last year. At the same time, the capital registered an increase of 28.5% compared to the previous period and 40% compared to last year.
It is assumed that after the revision of the legislation, data from the most recent purchase and sale agreements registered by the State Cadastre Agency (Agjencinë Shtetërore të Kadastrës; ASHK) and other relevant sources will be used to determine the cost of housing. By making changes to the legislation, the authorities plan to hold public consultations and adopt the experience of other countries.
Source: albania-news.ru
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