- The Albanian government has initiated efforts to tackle informality through digital measures like the Fiscalization process started in 2022
- This process requires businesses to issue electronic invoices for all transactions to enhance transparency and tax compliance and to fight tax evasion
- There is ongoing debate about whether these efforts are truly aimed at long-term improvement or are influenced by political motives
- The complexity of the tax system and its administrative procedures pose challenges for businesses, particularly small and medium-sized enterprises, in achieving full compliance
- Despite government claims of progress, real outcomes may take time to manifest, especially in sectors where informal practices are entrenched
- Examples from European countries like Italy and Finland offer insights into alternative methods that could aid Albania in refining its strategy
- These countries use flexible, context-specific strategies that encourage formalization without imposing heavy regulations
- Innovative labor market models from the EU, such as part-time or temporary work, could help integrate informal workers into the formal economy
- Albania could benefit from strategic adjustments like targeted support measures for skills development in informal sectors and sector-specific fiscal policies that incentivize formalization
- Effective management and monitoring of the transition from informality to formality will depend on a robust legal and institutional framework
Source: altax.al
Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.
