ALBIC - Info Business - Guide on Tax System in Albania

NATIONAL AND LOCAL TAXES

6. GENERAL REVIEW

In addition to direct and indirect taxes, Albanian tax system also consists of national and local taxes.

National taxes are deposited with the state budget, while local taxes with the budgets of local government units.

6.1. National taxes

Amended Law no. 8977, of 12.12.2002 “On the tax system in the Republic of Albania ” defines all types of national taxes, their levels, the agents in charge of tax collection and the exemptions from taxes.

With the entering in force of the law No. 9331, dated 06.12.2004, “On some amendments and changes on the law No.9877, dt.12.12.2002 “On Tax System in Albania ”, the following are exempt from national taxes group:

• Annual tax for vehicles tonnage per axis

• Tax on planes' take off, landing and stay at the airport

As a result, it is eliminated each provision of the respective laws with regard to these taxes. So far, national taxes include:

• Port taxes

Port taxes are paid by ships, which perform commercial activities every time they touch upon the harbors and ports of the Republic of Albania . By commercial activity of a ship we imply loading a nd unloading, landing and boarding of passengers

Port taxes in the Republic of Albania (In Euro)
Types of port taxes	For every net ton of ship register	Total for each ship
I. Tax of ship
For ships loading and unloading general goods	0,4
For ships loading and unloading liquid goods	0,6
For ferryboats RO/RO and passengers	0,35
For sport ships, yachts
- Up to 30 TRN		15
- From 31 to 70 TRN		30
II. Lighthouse tax:
- For ships up to 200 TRN		0,10
- For ships from 201 to 500 TRN		20
- For ships over 501 TRN		50
III. Tax on the formalities conducted by the health units, port and other authorities:
- For ships up to 200 TRN		0,25
- For ships from 201 to 500 TRN		100
- For ships from 501 to 2000 TRN		180
- For ships from 2001 to 4000 TRN		210
- For ships above 4001 TRN		300

• Taxes on consular services

I. Taxes for issuing visas and traveling documents:
For issuing the traveling passports	2000 leks
For issuing traveling passports by consular offices	50 EURO
For passport renewal by consular offices	15 EURO
For passage permit	200 leks
Passage permit issued by consular offices	30 EURO
Tax on visa for foreign citizens	Reciprocity
Tax on visa for foreign citizens entering the territory of Republic of Albania with tourist groups through travel agencies, based on reciprocity, but not above 10 EURO.
Tax on entry into the territory of Republic of Albania for foreign citizens, who don't need a visa, will be based on the principle of reciprocity, but not above 10 EURO.
Tax of entry by foreign citizens who need a visa and who enter the territory of the Republic of Albania with tourist groups through tourist agencies, reciprocity, not above 10 EURO.
This tax is not applicable for the period 1 May - 1 November.
One-day individual tourists and those organized in one-day tourist groups do not pay tax on visas or tax on entry.

II. Taxes on issuing, certifying and legalizing documents
Certificate of any kind issued by consular services for Albanian citizens	30 EURO
Certificate of any kind issued by consular services for foreign citizens	Reciprocity
Certificate of any kind issued by the consular services for Albanian citizens	30 EURO
Certificates of any kind issued by the consular services for foreign citizens	Reciprocity
Verification of document by consular services	10 EURO
Legalization of documents for Albanian Citizens from the Ministry for Foreign Affairs	200 leks
Legalization of documents by consular services for Albanian citizens*.	20 EURO
Legalization of documents for foreign citizens	Reciprocity

III. Taxes on issuing and compilation of other notary acts and translation of documents by consular services
Compilation of declarations, authorizations, testaments, contracts, guarantees, and special procurements by consular services	20 EURO/ page
Certification of duplicates and copies	20 EURO/ page
Translation of documents	10 EURO/ page

* According to the law No. 9331, Dt. 06.12.2004, “On some amendment and changes on the law no.8977, dt.12.12.2002 “On tax system in Albania ” amended, approved with Fiscal Package 2005, this tariff has been reduced.

• Tax on circulation for foreign motor vehicles

No.	Type of vehicle	In EURO
1.	For motorcars with fewer than 8+1 seats, including driver's seat, for every day or part of the day	1
2.	For motorcars with 8+1 seats, including driver's seat for each day or a part of the day	2
3.	For passenger busses tax is determined on the basis of reciprocity
4.	For trucks, trailers and the other vehicles for transporting goods, the tax is determined on the basis of reciprocity.
5.	In the case of the vehicles which don't have any load (freight) the tax is determined on the basis of reciprocity

• Import Tax on used vehicles

Type of vehicle		In lek
For vehicles produced as late as 31 December 1995
	For other vehicles carrying no more than 10 persons, vans, and other types of vehicles for carrying goods with a capacity up to 5 tons	80 000
	For buses and other types of vehicles for transportation of goods with a capacity above 5 tons	100 000
	For road tractors (tugging heads)	40 000
For vehicles produced as of 1 January 1996
	For other vehicles transporting no more than 10 persons, micro-vans, vans, and other means for transporting goods with a capacity up to 5 tons	50 000
	For buses and other means for transporting goods, with a capacity up to 5 tons	50 000
	For road tractors (tugging heads)	30 000

Vehicles import tax is calculated according to the following formula:

Fixed Tax x Cylinder of engine x Usage Coefficient

Fixed Tax for gasoline vehicles is 20 000 lek while for petroleum ones is 25 000 lek .

The cylinder of engine is the volume of the place of engine combustion in cm 3

Usage time refers to the difference between the years in which the vehicle entered Albanian custom with the production year.

The coefficient of usage time is in the following table:

Usage time	Coefficient
Up to 2 years from the production date	0.001
From 2 to 4 years from the production date	0.0015
From 4 to 7 years from the production date	0.0018
From 7 to 10 years from	0.002
Over 10 years from the production date	0.003

New law No. 9331, dated 06.12.2004, “On some amendments and changes on the law no.8977, dated 12.12.2002 “On tax system in Albania” amended, determines the application of this tax only based on the above mentioned formula and not as a fixed one. Usage time plays an important role on the calculation of this tax.

Customs offices serve as agents for the collection of vehicles import tax. Such a tax is paid by the importer of the vehicle at the time of passing the border. Agents of custom offices calculate this tax based on the above table and formula.

• Taxes for supplying a driving license to drive vehicles

Category	In lek
For driving license of category A	3 000
For driving license of category B	4 500
For driving license of category C	2 000
For driving license of category D	3 000
For driving license of categories BE , CE and DE	3 000

• Tax for using radio-television devices

For each user	In lek
For radio phonic receptive devices	100
For TV receptive devices	400
This tax is calculated and is paid by the family users only for one radio-TV receptive device, regardless of the number used by the family. For the other non –family users this tax is paid for each receptive device.

• Taxes for using telephone lines

• For fixed-line telephony each user pays up to 200 lek a year

• For contracted mobile telephony each user pays up to 400 lek a year

• For prepaid card mobile telephony each user pays up to 700 lek, only at the moment the number is sold.

• Taxes for actions and services by the administrations

For services by judicial administration and attorney's office		In lek	In %
For registering private, legal and physical entities (Albanian citizens)		1 000
For registering private legal and physical entities (foreign citizens)		4 500
For issuing a certificate that the person has no legal barriers for being equipped with a passport for abroad		100
For the court to issue any copy of ruling or document as requested by the interested person		100
For issuing penalty certificate by offices of the judicial status		100
For legalizing notary acts from the Ministry of Justice		100
Indictment requests submitted to the court
	For subsistence retirement	-
	For verification of facts	100
	Indictment for marriage break-up	1 500
	Indictment for invalidity of juridical actions	1 500
Indictment derived from contractual agreements and from inflicting damage: Worth up to 100 000 lek Worth up to 100 000 lek		1 500	1%
Indictment on division of wealth.		1 500
Indictment for the right to return to work		-

For actions that are carried out by the court executor	in lek	In %
For executing rulings and titles with an invaluable object	750
For executing rulings and other titles with valuable object Against citizens Against legal persons		3 7
For notices and other actions of the court executioner	100
For issuance by the court executioner of every act or document as requested by the interested person	100
For executing rulings with a subsistence retirement objective	-

Taxes for actions performed by notary offices	In lek
Compiling testaments through notary acts	450
Compiling oleograph testaments (certifying signatures)	200
Procures (editing): General Special	150 150
For issuance of copies, abridgement and parts of acts filed with the notary office	150
Certificates that copies or minutes of documents are identical to the original	150
Translation certificate and certifying translation with the original	100
Contracts for transferring movable property ownership	700
Contracts for transferring real estate ownership	1 000
Re-editing of various notary acts	150
Notices and notary reminders or other extra legal acts	150
Legalization of citizens' signature in various acts	100
Depositing the fundamental capital in founding an association on the basis of law 7638, dated 19.11.1992 «On Commercial Companies»	300
Acceptance of custody in notary offices for documents of physical and legal persons	300
Certificate of a person's being and his residence in a certain place	150
Other notary actions	100

For actions performed in the real estate registration office	In lek
Request for registration of real estate ownership	300
Request to register the division, sharing or joining of real estate	300
Request to prepare documents for the court or any other administrative unit	150
Request to register for property, rent or sublease transfer	300
Request for legal mortgage registration	150
Request to register for inclusion of legal mortgage registration	150
Request to register for inclusion of a court ruling or administrative act	150
Request for servitude registration, limiting agreement	150
Request to register for canceling servitude, limiting agreement	150
Registration of requests to give up ownership rights on inherited real estate	100
Registration of requests to gain ownership right on inherited real estate	300
Request for registration of legal actions on real estate by legal and physical persons residing overseas.	300
For issuing certificates on wealth	100
For issuing separate copies of certificates on wealth.	50
For issuing separate acts for mortgage action to the interested parties	50

• Enrolment Tax in higher education

This tax is equal to 200 leks for every school year.

• Tax on radio communication services

Part A: Tax on private radio communication services.

I. Aeronautic service	Lek per year
Base station on land	10 000
Mobile station on land	7 500
Portable station on land	5 000
Satellite terminal on plane	40 000
Radars and aeronautic radio navigation equipment (For each unit)	3 000
Plane stations with lifting capacity: Up to 3 200 kg Above 3 200 up to 14 000 kg Above 14 000 kg	5 000 40 000 80 000

II. Naval service
Coastal station	10 000 lek per year for each station
Radars and radio navigation equipment	2 500 lek per year for each station
Radio for port operations	1 500 lek per year for each radio
Base station onboard ships (HF, VHF, UHF)	5 000 lek per year for each radio
Portable station (VHF) onboard ships	500 lek per year
Satellite Terminal onboard ships INMARSAT	3 000 lek per year

III. Satellite service
Fixed land station: Analog with band range up to 100 kHz With band range above 100 up to 1MHz With band range above 1 MHz Digital, capacity: Up to 64 kbps Up to 2 Mb/s Above 2 Mb/s up to 8 Mb/s Above 8 Mb/s	150 000 lek per year 500 000 lek per year 1200 000 lek per year 25 000 lek per year 75 000 lek per year 300 000 lek per year 700 000 lek per year
Land station, transportable (on vehicles)	800 000 lek per year
Portable Station VSAT (in bag, suitcase)	30 000 lek per year
Transportable Land Station SNG up to one month stay in our country	60 000 lek per year
Portable Station VSAT (in bag, suitcase) up to six months stay in our country	15 000 lek per year

IV. Mobile service on land
1. Mobile service (PMR), from 146 MHz to 470 MHz
A. Duplex and semi duplex systems up 12,5 KHz channel range
Service Area	Connection between two repeaters	Connection of fixed station with mobile station and/or connection of a mobile station with another mobile station
Up to 15 km	15 000 lek per year	10 000 lek per year
From 15 up to 40 km	25 000 lek per year	20 000 lek per year
From 40 up to 80 km	55 000 lek per year	40 000 lek per year
Above 80 km	80 000 lek per year	65 000 lek per year
This tax level is applicable for systems having up to 10 mobile stations
• The following taxes are applicable for systems similar to those in 1.A, but with a bigger number of mobile stations: • For systems with 11 to 25 stations, the respective tax in 1.A increases by the same value with a 0.8 reduction coefficient. • For systems with 26 to 40 stations, the tax in 1.A with a 0.6 reduction coefficient is added to the above tax • For systems having more than 40 stations the tax in 1.A with a 0.4 reduction coefficient is added to the above tax
• For systems of 25 kHz channel range the tax calculated as in 1.A and 1.B is multiplied by a 1.5 reduction coefficient
• For simplex systems are applicable the respective taxes in 1.A and 1.B with a 0.5 reduction
2. National “trunk” system
100 000 lek per year for each channel of 12,5 kHz range
150 000 lek per year for each channel of 25 kHz range
3. Regional “trunk” system
30 000 lek per year for each channel of 12,5 kHz range
40 000 lek per year for each channel of 25 kHz range
4. TETRA system
50 000 lek per year for each channel of 25 kHz for the national system
20 000 lek per year for each channel of 25 kHz for the regional system

V. Fixed service for telecommunication operators
Two-directional connections
System in band up 80 MHz 80 000 lek per year for each channel of 3 kHz
System in band 80 up to 500 MHz 40 000 lek per year for each channel of 25 kHz
System in band 500 up to 1000 MHz 25 000 lek per year for each channel of 200 kHz 50 000 lek per year for each channel above 200 kHz
System in band above 1000 MHz
Analog	For each channel up to 1 MHz range	30 000 lek per year
	For each channel up to 10 MHz range	40 000 lek per year
	For each channel above 10 MHz	60 000 lek per year
Digital	For a capacity up to 128 kb/s	5 000 lek per year
	For a capacity up to 2 Mb/s	20 000 lek per year
	For a capacity up to 8 Mb/s	30 000 lek per year
	For a capacity up to 34 Mb/s	40 000 lek per year
	For a capacity above 34 Mb/s	50 000 lek per year
Note: The term local implies territory coverage on a district-level. The term regional implies territory coverage of some districts. The term national implies coverage of 50% of Albanian territory. For one-directional connections the above tax level is multiplied by a 0.5 coefficient. The term connection implies the tract using either a couple of radio frequencies or a single one.

Part B : Taxes on public radio communication services

Type of service	Lek per year
Fixed land service
For non-exclusive use of frequencies
Analog system (radio-relay) (For each telephone channel of 3 kHz)	3 000
Digital system (radio-relay) (For each telephone channel of 64 kHz)	1 500
Digital system (radio-relay) (For each link of 2 Mbit/sec)	20 000
Rural telephones radio systems (For each telephone channel)	1 000
Wireless system in 3,5 GHz (for each MHz)	100 000
Wireless system in 10,5 GHz (for each MHz)	60 000
Wireless system above 10,5 GHz (for each MHZ)	40 000
For exclusive use of frequencies on a national level
In UHF band (For each 1 Mhz of band range used)	100 000
In 1-5 Ghz band (For each 1 Mhz of band range used)	60 000
In 5-11Ghz band (For each 1 Mhz of band range used)	40 000
Above 11 Ghz band (For each 1 Mhz of band range used)	20 000
Wireless System in 3,5 GHz (for each MHz)	200 000
Wireless System in 10,5 GHz (for each MHz)	150 000
Wireless System above 10,5 GHz (for each MHz)	100 000

Fixed satellite system
Analog System (For each telephone channel of 3 Khz)	5 000
Digital System (For each channel Kb/s)	4 000

Pager service
Connection between fixed stations (base-repeaters) (For each radio beat)	40 000
For each base station	30 000

Public mobile telephone service (GSM, EGSM, DCS 1800, Imt-2000) (for each channel of 200 kHz)	150 000

Internet service
Satellite system connection (For each unit of 64 kb/s)	10 000
Connection radio-relay system (For each unit of 64 kb/s)	1 500

Satellite telephone system (GMPCS)	4 000 EURO

• Annual taxes on radio-television broadcast services

Type of service	Lek per year
1. For each land analogue television broadcaster or repeater
a. With radiated power up to 10W	1 500
b. With radiated power up to 100 W	6 000
c. With radiated power up to 1000W	24 000
ç. With radiated power up to 10000W	48 000
d. With radiated power above 10000W	60 000
2. For each FM radio land broadcaster or repeater
a. With radiated power up to 10W	300
b. With radiated power up to 100 W	1 200
c. With radiated power up to 1000W	4 800
ç. With radiated power up to 10000W	9 600
d. With radiated power above 10000W	12 000
If one of the broadcasters or repeaters in 1.b, 1.c, 1.ç, 1.d, 2b, 2c, 2ç, 2d, covers more than half of the city of Tirana , the tax calculated there, is multiplied by a coefficient of 5.
If one of the broadcasters or repeaters in 1.b, 1.c, 1.ç, 1.d, 2b, 2c, 2ç, 2d, covers more than half of a city with a population of above 100 000 inhabitants, the tax calculated there, is multiplied by a coefficient of 2
If one of the broadcasters or repeaters in 1.b, 1.c, 1.ç, 1.d, 2b, 2c, 2ç, 2d, covers more than half of a city with a population from 50 000 up to 100 000 inhabitants, the tax calculated there, is multiplied by a coefficient of 1,5.
If one of the broadcasters or repeaters in 1.b, 1.c, 1.ç, 1.d, 2b, 2c, 2ç, 2d, covers two or more cities cited in points 3,4,5, the tax calculated there, is multiplied, only once, by the highest coefficient
For each AM broadcaster 200 000 lek per year.
Radio and/or television operators re-broadcasting foreign programs through repeaters licensed by NCRT (National Council for Radio and Television) pay only 20% of the taxes specified above.

• Tax on plane crossing of state borders of the Republic of Albania is applied :

• For foreign citizens, 10 EURO for each crossing or the counter value of 10 EURO for convertible foreign currencies;

For Albanian citizens, 1 000 (one thousand) lek for each crossing.

• Tax on acquiring navigation passport is 750 (seven hundred and fifty) lek per person.

• Tax on exercising fishing activity

Type of activity		Lek per year
Sea fishing (for one ship)
Drop net Sea Fishing
	Ship 160-200 HP	40 000
	Ship 201-410 HP	50 000
	Ship above 410 HP	80 000
Drift net Fishing
	Ship 160-200 HP	20 000
	Ship 201-410 HP	30 000
	Ship above 410 HP	40 000
Fishing with encirclement
	Ship 80-200 HP	10 000
	Ship 201-410 HP	20 000
	Ship above 410 HP	30 000
Drop net fishing
	Ship 160-200 HP	40 000
	Ship 201-410 HP	60 000
	Ship above 410 HP	90 000
Drop net fishing with selected equipment
	Ship 40 - 80 HP	15 000
	Ship 81-160 HP	25 000
	Ship 161-200 HP	40 000
	Ship 201-410 HP	50 000
	Ship above 410 HP	80 000
Fishing of bivalve mollusks		60 000

Handicraft fishing with light equipment
Coastal fishing (for one motor-boat Up to 40HP)		7 000
Fishing in sea lagoons
	In lagoon (1 sailing boat)	10 000
	In embouchure (1 fisherman)	12 000
Fishing in inland waters
	Active (1 sailing boat)	5 000
	In embouchures and dikes (1 fisherman)	8 000
Collection of bivalve mollusks with light equipment for 1 (one) fisherman		20 000

Sea Sport fishing with sailing equipment (for 1 (one) equipment		40 000

Aquaculture
Cultivation of mussels for one plant		10 000
Plant cultivation of fish at sea, in lakes and reservoirs		1 000
Aquaculture with land plants		10 000
Note: For foreign ships licensed to fish in our territorial waters, the tax on exercising their activity will be twice that applied for Albanian ships. This tax does not apply to ships authorized by the Ministry of Agriculture and Food (Fishing Department) to fish for study and scientific purposes.

• Act and stamp tax

Act and stamp tax	In lek
For issuing civil status certificates	50
For issuing domestic use passports	100
For obtaining any issued or lost civil status act and for correcting them	50
For registration of citizenship granting	700
For registration of cession of citizenship	700
For registration of the decision to change name or surname	700
For any marriage	600

• Tax on planes crossing the territory of the Republic of Albania

This tax is calculated on the basis of unit rate annually established by Euro Control.

• Tax on mining rent is determined according to law nr. 7796, of 17.02.1994 “ Albania 's mining law”.

• Tax on ownership transfer for movable property (vehicles)

The tax level is 2% of the value of transferred (sold) property .

19. Annual Tax on the circulation of vehicles

With the entering in force of the law No. 9331, dated 06.12.2004, “On some amendments and changes on the law no.8977, dated 12.12.2002 “On the tax system in the Republic of Albania” amended, the tax level is determined as follows:

No	TYPE OF VEHICLE	TAX LEVEL (lek)
1	Cycle motor	.....
2	Motorcars	500
3	Cars: Not more than 4 + 1 seats, gasoline Not more than 4 + 1 seats, petroleum More than 4 + 1 seats, gasoline More than 4 + 1 seats, petroleum	7 000 10 000 25 000 35 000
4	Mixed transport vehicle: Maximum weight less than 3 t. Maximum weight more than 3 t. but less than 3.5 t.	26 000 37 000
5	Trucks: Maximum weight more than 3.5 t. but less than 7.5 t. Maximum weight more than 7.5 t. but less than 18 t. Maximum weight more than 18 t.	46 000 64 000 92 000
6	Buses: With more 8 + 1 seats but less than 32 + 1 seats With more than 32 + 1 but less than 42 + 1 seats With more 42 + 1 seats and articulated buses	34 000 43 000 53 000
7	Vehicles of special use: Maximum weight up to 3.5 t. Maximum weight more than 3.5 t. but less than 7.5 t. Maximum weight more than 7.5 t. but less than 18 t. Maximum weight more than 18 t.	37 000 46 000 64 000 92 000
8	Vehicles for special transportation; Maximum weight up to 3.5 t. Maximum weight more than 3.5 t. but less than 7.5 t. Maximum weight more than 7.5 t. but less than 18 t. Maximum weight more than 18 t.	37 000 46 000 66 000 106 000
9	Road tractors (tugging heads)	50 000
10	Auto camp	46 000
11	Trailer: Maximum weight up to 750 kg Maximum weight more than 750 kg but less than 1500 kg Maximum weight more than 1500 kg but less than 7000 kg Maximum weight more than 7000 kg	5 000 8 000 10 000 17 000
12	Semi trailer	36 000
13	Agricultural vehicles : Maximum weight up to 3.5 t. Maximum weight more than 3.5 t. but less than 7.5 t. Maximum weight more than 7.5 t. but less than 18 t. Maximum weight more than 18 t.	2 000 2 000 2 000 2 000
14	Technological vehicles: Maximum weight up to 3.5 t. Maximum weight more than 3.5 t. but less than 7.5 t. Maximum weight more than 7.5 t. but less than 18 t. Maximum weight more than 18 t.	20 000 38 000 48 000 54 000
15	Special vehicles: Maximum weight up to 3.5 t. Maximum weight more than 3.5 t. but less than 7.5 t. Maximum weight more than 7.5 t. but less than 18 t. Maximum weight more than 18 t.	37 000 46 000 64 000 92 000

According to the new law in force, General Department of Road Transport Services and the Department of Order and Public Security near the Ministry of Public Order are engaged with the control of the tax payments. The respective authorities collect this tax at the moment of technical control of the vehicle.

• Tax on carbon (environment tax)

This tax applies to imported or domestic fuels as follows:

For gasoline..........0.5 lek per litre

For petrol...............1 lek per litre

• Tax on plastic packing of liquids (environment tax)

Its level is:

• Two lek per unit for above 1.5 litre capacity packing;

• 1 lek per unit for 1.5 litre or less than 1.5 litre packing .

• Registration Tax on games of luck, casinos, hippodrome sport races

This tax is determined as follows:

For arithmetic or sport games of luck, lotteries and electronic games of immediate gain 10 000 000 lek

For casinos 30 000 000 lek

For hippodrome sport races 20 000 000 lek

6 .2. Local Taxes

6.2.1. Property Taxes

• Tax object

All legal or physical persons, whether native or foreign, owning immovable property in the territory of the Republic of Albania and regardless of its utilization level, are subject to immovable property tax, except for cases differently provided for by law. Immovable property taxes include:

• Tax on buildings

• Tax on farming land

• Tax Calculation Basis

The calculation basis for tax on buildings is the building area in square meters or the area of its parts under and on the ground and for every floor. The area owned by the taxpayer is determined on the basis of documents certifying this ownership.

The tax basis for farming land is the farming land area in hectares owned by the taxpayer. The owned area of farming land is determined on the basis of documents certifying this ownership,

• Exemptions from immovable property tax

• Exempt from the tax on buildings are:

Properties of state or local government entities, which are used for non-profit purposes;

Residence buildings utilized by tenants upon non-liberalized lease.

Buildings utilized by religious communities

• Exempt from this tax is farming land planted with fruit-tree and vine-yard cultures for their first five years from the moment of planting.

• Property tax levels

Tax on buildings

The level of tax on buildings is determined in lek per square meter. The tax obligation is calculated by multiplying the tax level with the taxable basis.

For the purpose of taxable basis, the table below illustrates the minimum tax levels per square meter. For each minimum tax category per square meter, the Municipal Council or the Communal Council may adopt subcategories of buildings situated within the territory it covers.

Indicator levels on tax on buildings

Local tax on buildings (lek/m 2 per year)

Municipalities

Zone 1

Zone 2

Zone 3

Minimum building categories

I. Residence Buildings

- Built before 1993

15

10

5

- Built during or after 1993

30

12

6

II. Other buildings

- For trade and services

200

150

100

- Others

50

30

20

Zone 1: Tirana, Durrës.

Zone 2: Vlora, Fieri, Saranda, Pogradeci, Korça, Elbasani, Berati, Lushnja, Gjirokastra, Shkodra, Kavaja, Lezha.

Zone 3: All other municipalities

Tax on farming land

The level of this tax is determined in lek per hectare. This tax obligation is calculated by multiplying the tax level with its basis. For each minimum category of farming land, the Municipal Council or the Communal Council may adopt subcategories.

The tax indicator levels for each minimum category of tax basis are given in the table below:

MINIMUM CATEGORIES AND LEVELS OF TAX ON LAND

Classification according to land category

Classification according to districts

Zone 1

Zone 2

Zone 3

Zone 4

I

II

III

IV

V

VI

VII-X

5 600

4 900

4 200

3 600

3 000

2 400

1 800

4 200

3 500

2 800

2 300

1 900

1 600

1 400

2 800

2 100

1 400

1 350

1 250

1 200

1 100

1 400

1 200

1 100

1 000

900

800

700

Zone 1: Tirana, Durrësi, Kavaja, Kruja, Lezha, Lushnja, Fieri, Vlora, Saranda.

Zone 2: Shkodra, Elbasani, Berati, Korça, Delvina, Kurbini, Peqini, Kuçova.

Zone 3: Gjirokastra, Përmeti, Pogradeci, Librazhdi, Dibra, Mati, Skrapari, Mallakastra, Devolli, Tepelena.

Zone 4: Bulqiza, Hasi, Kukësi, Tropoja, Puka, Mirdita, Malësia e Madhe, Gramshi, Erseka

6.2.2. Other Local taxes

• Tax on hotel accommodation

The basis of this tax is the price for one-night accommodation, either per room or per person. The tax level must not exceed 5% of the price.

The tax obligation is calculated by multiplying the tax level with the price per-night and the number of nights spent in the hotel.

The tax obligation belongs to the client accommodated in the hotel, which keeps this obligation on the account of the municipality or commune in whose territory the hotel is situated.

• Tax on new buildings' impact on infrastructure

The basis of this tax is the value in lek of the new investment to be made. The classification as new investment and its respective values are determined in accordance with the legislation in force applicable for acquiring construction permission.

The tax level is expressed as a percentage of the investment value and it varies from 1 to 3% of this value, whereas for Tirana municipality it varies from 2 to 4% of the investment value.

The tax payment obligation belongs to the investor. In all cases, this tax income is collected by the body issuing the construction permission and is cashed, in all cases, on the account of the municipality or commune in whose territory the investment will be made.

• Tax on transferring ownership right for immovable property

The tax on transferring ownership right for immovable property applies to buildings and all immovable property, at the moment of transferring ownership right on it.

The legal or physical person, who transfers (sells or grants) ownership right on immovable property, pays the tax before registration is completed, in accordance with legal acts in force. Therefore, all trading, legal or physical persons pay this tax. Individuals who transfer (sell or grant) immovable properties do not pay this tax, since, for these transactions, they pay tax on their personal incomes.

The tax basis for transferring ownership right for buildings is the building area of the edifice whose ownership is transferred. The tax level is determined in lek per square meter of the tax basis. The tax obligation is calculated by multiplying the tax level with its basis.

For the purpose of taxable basis, the building categories and respective tariffs are given in the following table:

Levels of tax on transferring ownership for buildings

Municipalities

Zone 1

Zone 2

Zone 3

Building

Categories

Tirana

Durrësi

Vlora

Fieri

Saranda

Pogradeci

Korça

Elbasani

Berat

Lushnja

Gjirokastra

Shkodra

Kavaja

Lezha

All other

Municipalities

Lek/m 2

I. Residence Buildings

1 000

300

100

II. Other buildings for

trade and services

2 000

700

300

III. Other Buildings

1 500

500

200

Tax indicator levels, given in the table, are valid for municipalities. All communes adopt the tax level established for zone 3 of municipalities.

For other immovable property (land, terrain) the tax basis for transferring ownership right is the value of their sale. The tax level is determined in percentage and the indicator level is 2%. The tax obligation is calculated by multiplying the tax level with its basis.

The immovable property registration office, where this property is registered, collects the tax.

Exempt from payment of the tax on transferring ownership right on immovable properties are:

• The National Residence Entity, National Privatization Agency and local or central government bodies;

• Persons subject to personal income tax, based on law nr. 8438, of 28.12.1998 “On income tax”;

• Subjects granting immovable property when the direct beneficiaries are:

• State and public, local and central institutions and entities;

• Religious communities or non-profit organizations when the grant is related to the non-profit part of their activity.

• Annual registration tax on road transportation vehicles

The basis of this tax is the type of road transportation vehicle.

The tax level is expressed in a quota, which is fixed according to the type of vehicle. The respective categories and levels established according to vehicles are given in the following table:

<

Nr.

Type of Vehicle

Tax Amount in lek

1.

Motor vehicles

600

2.

Cars with (4 + 1) or fewer seats

2 400

3.

Cars and vans with (8+1) or fewer seats

4 800

4.

Bus with (32 + 1) or fewer seats

6 000

5.

Bus with (42 + 1) or fewer seats

7 200

6.

Bus with more than (42 + 1) seats

8 400

7.

Articulated bus with more than (42 + 1) seats

9 000

8.

Van or vehicle with maximum authorized weight up to 3,5 tons

3 600

9.