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LAW No. 8438, dated 28.12.1998 "ON INCOME TAX" Based on Articles 81, 83, paragraph 1 and 155 of the Constitution of the Republic of Albania, with the proposal of the Council of Ministers, THE ASSEMBLY OF THE REPUBLIC OF ALBANIA DECIDED: CHAPTER I GENERAL PROVISIONS Article 1 Scope This law regulates relationships regarding personal income tax, profit tax, and tax deducted at the source of income. Article 2 Definitions For the purposes of this law the following terms mean: a. "Taxpayer" is every person, natural or legal, subject to tax payment imposed by this law. b. "Person" is any natural person, non-commercial according to the Civil Code, hereinafter called "individual"; any natural person, commercial, hereinafter called "natural person", as well as any legal person. c. "Legal person" is a commercial company, incorporated according to Law No. 7638, dated 19.11.1992 "For Commercial Companies", as well as other legal persons, incorporated according to the Civil Code, which carry out profitable activity in the territory of the Republic of Albania, as well as other legal persons incorporated or recognized as such by specific laws.
ç) "Partnership" is every group of natural persons and legal persons joined to carry out a temporary, common and profitable activity, which is not established as a separate legal person, in the ways provided by Law No. 7638, dated 19.11.1992 "For Commercial Companies", from the Civil Code or other specific laws. d. "Related persons" are persons whose activity, according to the law or through implementing any legal or commercial action, is controlled by another person or by a third person, or who carry out activity according to guidelines, requests and decisions of another person or a third person. Persons related to each-other, but not limited to them, will be: - spouses; - the legal person or any person who directly or indirectly owns 50% or more, in value or in number, of parts or rights to vote in that legal person; - two or more legal persons, if a third party directly or indirectly owns 50% or more, in value or number, of parts or rights to vote in each legal person; (dh) "Permanent headquarter" is the headquarter defined in the articles of incorporation of the legal person, according to the respective legislation. Also, in the meaning of this law, the following are considered as permanent headquarter: - an office of the branch, affiliate, or representative office of the legal person; - the location where the legal person provides services or trades goods, on the basis of a contract or agreement recognized by the Albanian legislation, independently from the headquarter indicated in its articles of incorporation. Article 3 Residence The following persons are considered residents in the Republic of Albania: 1. An individual, in case: he/she has a stable accommodation in the territory of the Republic of Albania, in the meaning of Article 12 of the Civil Code; he/she is an Albanian citizen and a consul, diplomat, or similar officer of the Republic of Albania, outside its territory. 2. The individual who resides in Albania more than 183 days of a taxable period, whether consecutively or not. 3. The legal person, who in the meaning of this law, has its permanent headquarters located in the Republic of Albania. 4. The natural person, who, according to commercial legislation, is registered as such in the commercial register of the competent court.
Article 4 Source of income Incomes from a source in the Republic of Albania will include, but will not be limited to the following: a. income from labor relationships carried out in the Republic of Albania; b. income from cultural or sportive activity, as well as other personal activities in the Republic of Albania; c. income from a business conducted from a nonresident person in Albania through a person with permanent headquarters in the Republic of Albania; ç) income from transferring the right of ownership on immovable property to the benefit of a person with permanent headquarters in the Republic of Albania; d. income from ownership on immovable property, accessories and its fruits, and income from other rights deriving from ownership on immovable property if these things are located in the Republic of Albania; dh) income from transfer of property mentioned in item "dh" of this article; e. income from dividends paid by a resident legal person; ë) income from parts of profit paid by a resident partnership; f. income from interests paid by either central or local government, or by a resident in the Republic of Albania, or paid by a nonresident through a person who has permanent headquarter in the Republic of Albania; g. income from copyright, intellectual property, leasing and emphiteosis; (gj) other income, a non resident benefits through a person with permanent headquarters in the Republic of Albania. Article 5 Taxable period Taxable period commences on January 1, and ends on December 31 of each calendar year. CHAPTER II PERSONAL INCOME TAX
Article 6 Scope of taxation on personal income Personal income tax, hereinafter called "income", shall be calculated on the income of individuals. Article 7 Inclusion in the tax 1. Resident individuals are subject to the payment of tax on personal income during the taxable period, from all sources of income, according to provisions of this chapter. 2. Nonresident individuals are subject to the payment of tax on personal income during the taxable period, according to the provisions of this chapter, for sources of income generated in the territory of the Republic of Albania. Article 8 Taxable income 1. For the purposes of taxation on personal income tax, the following shall be considered as taxable income: a. salaries and other compensations with respect to actual employment relations; it is tax exempt the income generated from salaries and compensations for labor relationships of consular, diplomatic or similar officials of other countries and international organizations who, during performance of their official functions in the Republic of Albania, according to international conventions or agreements signed or accepted by the Republic of Albania or the Albanian Government, enjoy the diplomatic status, is tax exempt income. Individuals, Albanian or foreign, who do not enjoy the diplomatic status, recognized by international conventions or agreements for this purpose, are not subject to this exemption; b. income resulting from profits of a partner or a shareholder in a commercial company; c. income from bank interests or interests from valuable bonds, excluding interest received from Government s treasury bills or other valuable bonds of the Government issued before the effective date this law enters into force; ç) income derived from copyright and intellectual property; d. income from emphiteosis, loans and leases, excluding cases when income is generated from conducting commercial activity, in the meaning of commercial legislation;
dh) income from transferring immovable property rights; e. income of individuals from games of gambling and casinos. Article 9 Tax tariffs 1. Salaries and compensations with respect to actual employment relations shall be taxed according to tariffs described in Table No. 1 attached to this law. 2. Dividends, income generated from profits of a partner, interest, loans, leases or other similar contracts, emphiteosis, income from copyright or intellectual property, as well as all other compensation or income, which are not provided for in the first paragraph of this article, shall be taxed at 10%. 3. From the tax calculated according to the first and second paragraph of this article shall be deducted the tax withheld according to Article 33 and the amounts provided by Article 37 of this law. Article 10 Tax collection 1. Every employer who pays a salary or compensation as provided in point "a" of Article 8 of this law deducts personal income tax according to the first paragraph of Article 9 of this law, and deposits such tax in the accounts of the tax organ no later than the 15th of the next month. 1. All employers keep records of payments described in point "a" of Article 8 of this law, according to instructions issued by the Ministry of Finance. Article 11 Transfer of the right of ownership on immovable property 1. The transfer of ownership rights on immovable property is taxed according to Table No. 2 attached to this law. 2. Payable tax is paid by the person who transfers the ownership right on immovable property before registering the above things, according to legislation in force. The immovable property is not registered, without certifying payment of such tax to the offices of registration of immovable property. 3. Offices of registration of immovable property are required to deposit, within 10 days, the collected tax according to the provisions of this article. Article 12
Profits from games of gambling and casinos 1. Any person who gains an amount from games of gambling and casinos pays tax from that amount at the rate of 20% of the sum earned. The organizer of games of gambling or casinos withhold such a tax and, within 24 hours, are required to deposit the withheld tax in the account of the tax organs. 2. The organizer of games of gambling or casinos issues to the winner a document which shows the amount earned and deduction of the withheld tax. Article 13 Obligation to pay Any individual who earns income during the taxable period, which are subject to personal income tax, must declare such income, according to the instructions of the Ministry of Finance. Persons who are subject to the first paragraph of Article 10 and Article 33 of this law are exempt from this obligation. Article 14 Violations According to Chapter II of this law, the following actions or non-actions constitute violations of this law: a) Hiding from tax authorities amounts collected and falsifying information on income. b) Failure to document income. c) Failure to deduct or deposit in the budget the personal income tax. ç) Failure to submit or failure to prepare in due time the declaration. d) Failure to pay within the time limit the tax. Article 15 Sanctions When the violations provided for in Article 14 of this law, do not constitute a criminal act, they constitute administrative violations and are punished with the following fines: a) For the cases of points "a", "b" and "c" of Article 14 of this law, the responsible persons, apart from the obligation to pay the whole amount of the initial sum of the hidden tax, are punished with fines which are five times the amount of hidden personal income tax.
b) For cases provided for in point "ç" of Article 14 of this law, the responsible persons are punished with fines equal to twice their tax liability and l00% of the original tax amount. c) For cases provided for in point "d" of Article 14 of this law, the responsible persons are punished with fines at the rate of 0.5% of the unpaid amount of tax liability for each day of delay. Procedures of complaining and executing the administrative measure are performed according to Law No. 7681, dated 4.3.1993 "For administering taxes and duties in the Republic of Albania." 1. The profit tax shall be imposed on: PART III PROFIT TAX Article 16 Scope of profit tax a) Legal persons and partnerships foreseen in points "c" and "d" of Article 2 of this law. b) Legal persons, partnerships or other groups of persons incorporated or organized on the basis of foreign law and which carry out activity in the territory of the Republic of Albania. c) Every other person, regardless of the legal form of registration or its recognition, when such a person is subject to payment of the value added tax. 2. All natural persons who have registered with the office of the Value Added Tax and who are not subject to the small business tax, are subject to profit tax. Article 17 Payment requirement 1. Resident taxpayers are subject to profit tax for profit derived from all sources, within and outside the territory of the Republic of Albania. 2. Nonresident taxpayers are subject to profit tax for all income derived from sources within the Republic of Albania. Article 18 Exemptions The following persons will be exempt from profit tax:
a) central and local government institutions; b) Bank of Albania; c) legal persons, which carry out only religious, humanitarian, charitable, scientific, or educational activity, whose property or profit is not used in the interest of their organizers or members; ç) employment organizations or chambers of commerce, industry or agriculture, whose property or profit is not used in the interest of an individual or a member of theirs; d) international organizations, agencies of technical cooperation and their presence, whose exemption from taxation is established by specific agreements; dh) persons provided for in international agreements ratified by the Assembly. Article 19 Taxable Profit Taxable profit for the taxable period is defined on the basis of the balance sheet and its annexes which should be in conformity with Law No. 7661, dated 19.1.1993, "For Accounting", with the provisions of this law, as well as sub-legal acts issued by the Ministry of Finance for this purpose. Article 20 Deductible expenses For determining taxable profit in the Republic of Albania, there will be recognized as expenses those incurred for profit, guarantee and guarding of the profit to the extent that such expenses are documented and proved by the taxpayer, and when they are subject to restrictions specified by this law. Article 21 Non Deductible Expenses 1. For the effect of defining the taxable profit the following expenses are not deductible: a) The cost of acquisition and improvement of land and building site; b) the cost of acquisition, improvement, renovation, and reconstruction of assets of the activity, which are depreciated according to Article 22 of this law;
c) an increase of the initial capital of the company or contribution of each person in a partnership; ç) value of remuneration in kind; d) voluntary pension contributions; e) dividends declared and profit shared among partners or shareholders of commercial companies, as well as profits in case of partnership; ë) paid interests which exceed the maximum loan interest defined by the Bank of Albania; f) fines, charges for late payments, and other penalizing conditions; g) creation or increase of reserves and other special funds except for cases foreseen by law or sub-legal acts; gj) personal income tax, excise, profit tax, and value added tax, deductible; h) representation expenses; i) personal consumption expenses as defined by the Minister of Finance; j) expenses that exceed limits established by law or sub-legal acts; k) expenses for gifts, receptions; l) any expense that the taxpayer does not certify by means of document. 2. If during the taxable period, loan and prepayment exceeds in average four times the amount of initial capital, the interest paid for this amount is not recognized as deductible expense. This paragraph is not applied for banks and insurance companies. 3. For legal persons that are not established based on Law No. 7638, dated 19.11.1992 "For Commercial Companies", the second paragraph shall not apply in the same manner as it is applied for other persons provided for in this article. Article 22 Depreciation 1. For determining taxable profit, depreciation for assets of businesses shall be calculated by: a) the owner of assets of the activity in all the cases except for those mentioned in point "b" of this article;
b) the person who bears the risk for losses or damage of assets, in cases of assets in the cases of assets rented, given in usufruct, or any other form as provided for by legal provisions. 2. Land, building site, art work, antiquaries, jewelry, precious metals and stones are not depreciable. 3. Costs of purchase or construction, costs of improvement, restoration and reconstruction of buildings, construction and machinery and equipment on service for long term will be calculated separately for the purposes of depreciation, in a linear way, at the rate of 5%. 4. Costs of purchase or construction, and costs of improvement, restoration and reconstruction of non-incorporated assets will be calculated separately, in a linear way at the rate of 10%. 5. Depreciation for categories of assets described in the two items mentioned below will be calculated on the basis of a grouping system with the following percentages: a) Computers, information systems, software products, and equipment of database back up with 25%. b) All other assets of the activity at 20%. c) For assets, of the governmental enterprises or enterprises with capital that is totally state owned, that are depreciated according to point "b" of the fifth paragraph of this article, the depreciation norm for years 1999-2000 is 10%. 6. In each category described under the fifth paragraph of this article, the depreciation percentage specified in this point will be applied on the basis of depreciation of the appropriate category. 7. The depreciation basis will be the accounting value of the registered category as it is recorded in the balance sheet in the beginning of the taxable period: a) by adding the purchase cost or asset creation, and improvement, restoration, and reconstruction cost of assets of the category during the taxable period; b) by deducting the selling price of assets and compensations received for loss of assets because of force majeure or other involuntary changes during the taxable period. In case that the depreciation basis is a negative amount, that amount will be added to the taxable profit and the depreciation basis will be considered zero. In case that the depreciation basis does not exceed 5000 lekë, all the depreciation basis will be considered a deductible business expense. In cases of reevaluation of assets of a business, depreciation will not be allowed for the reevaluated amount.
Article 23 Inventory At the end of the taxable period, the taxpayer assesses the inventory with the selected method of assessment, which must be applied systematically. Article 24 Bad debts In determining taxable profit, bad debt is recognized as a deductible expense if the following three conditions are simultaneously met: a) An amount corresponding to this bad debt is included earlier in the income; b) the bad debt is canceled from the accounting books of the taxpayer; c) all possible legal actions to cash in the debt have been undertaken. Article 25 Special reserves for banks and insurance companies In determining taxable profit of banks and insurance companies deductions shall be allowed for known technical reserves created in compliance with Law No. 8081, dated 7.3.1996 "For Insurance and Reinsurance Activities", and banks supplies created according to the rules issued by the Bank of Albania for this purpose. However, amounts withdrawn again from these reserves or supplies shall be added to the taxable profit. Article 26 Participation that is not subject to profit tax 1. Dividends and distribution of earnings are excluded from income for purposes of determining taxable profit of a resident person. 2. When they are distributed by resident companies or partnership which: a) are subject to profit tax; b) the beneficiary subject has a package of shares no less than 25% in value or number, or stock capital or voting rights and for partnership of no less than 25% of the initial capital. Article 27
Carryover loss 1. If taxable profit during a taxable period results negative, such a loss can be compensated with profits in the following three taxable periods, according to the principle "the first loss before the last one". 2. In case during a taxable period direct and/or indirect ownership of initial capital or voting rights of a person changes with more than 25% in value or number, the above paragraph does not apply for losses that legal person suffered during that taxable period and in previous taxable periods. Profit tax rate shall be 30%. Article 28 Tax rate Article 29 Tax declaration 1. Every taxpayer prepares the annual statement of the taxable income in the form defined by the Ministry of Finance. Taxpayers submit the annual statement of the taxable income to the tax organs within March 31of the following year, presenting at the same time the balance sheet, the profit and loss accounts for the relevant taxable period, as well as annexes of annual accounts. 2. Tax calculated on the basis of the annual statement of taxable income, deducting tax withheld according to Article 33 of this law and amounts defined according to Article 37 of this law, and advance payments done during the taxable period, shall be paid by the taxpayer to the tax organ's account within 15 days after presenting the annual statement of taxable income. 3. Any advance payment that exceeds tax calculated according to the second paragraph of this article is used by the tax organs to pay carried over tax liabilities, or future tax liabilities or, upon the taxpayer's request, the tax organ shall pay back the surplus to the taxpayer within 15 days from receipt of the tax declaration. Article 30 Payment in advance 1. During the current taxable period, the taxpayer pre-pays, no later than date 15 of each month, in the tax organ's account, amounts as follows: a) For each month of January, February, March and April of the current taxable period, the amount of profit tax for the taxable period of the two previous years divided by twelve;
b) For each of the other eight months of the current taxable period, the amount of profit tax for the previous taxable period having deducted payments made from January to April of the current taxable period, divided by eight. 2. In the cases when the taxpayer starts the activity during the taxable period of the second previous year, payment in advance for the months from January to April of the current taxable period shall be as follows: The amount of profit tax for the taxable period of two preceding years divided by the number of months during which the taxpayer has conducted taxable activity. For determining payment in advance for the other months of the current taxable period, taxation is calculated according to point "b" of the first paragraph of this article. 3. If the taxpayer starts the activity during the preceding taxable period, payment in advance for months January-April of the current taxable period shall equal the estimated amount of profit tax for the preceding period divided by the number of months of the preceding period during which the activity has been performed. Point "b" of the first paragraph of this article applies to determine payment in advance for the remaining months from the current taxable period. 4. In case a taxpayer starts the activity in the current taxable period, payment in advance for this period shall equal the estimated amount of profit tax for the current period divided by the number of remaining months from the current taxable period. 5. If a taxpayer can demonstrate to the tax bodies, at any time during a taxable period, that profit tax imposed for that taxable period shall be significantly lower than profit tax for the preceding taxable period, or the second preceding period, then the tax organ accept the decrease of payment in advance according to the instructions defined by the Ministry of Finance. 6. If the tax organs evaluate that profit tax for the current taxable period shall exceed by more than 10% the profit tax for the preceding taxable period, it may adjust by increasing the payment in advance according to profit tax as the tax organ assesses. 7. For taxpayers whose monthly payment in advance according to the first paragraph of this article, for the current taxable period or for the preceding taxable period has not exceeded 10 000 lekë, these payments in advance may be accumulated for each three monthly period and paid by the 15 th of the month following the three months. Article 31 Violations Based on this chapter, the following actions or failures to act constitute violations of this law: a) hiding income of the activity; b) falsification of data and documents relating to income and expenses;
c) failure to submit in due time the tax declaration and balance sheet and its annexes; ç) failure to pay tax in due time; d) wrong keeping of accounts that does not affect the financial result. Article 32 Sanctions Violations provided for by Article 31 of this law, when they do not constitute criminal action, they constitute administrative violations and are punished by fine as follows: a) Hiding of income generated from the activity and falsification of data and documents concerning income and expenses, apart from one hundred per cent payment of the unpaid tax, is punished with a fine that is five times the unpaid tax. b) Failure to submit in due time the tax declaration and the annual balance sheet together with its annexes is punished with a fine of 25 000 to 50 000 lekë. In case of relapse, the fine is doubled. c) Failure to pay in due time the tax liability is punished with a fine at the amount of 0.5% of the unpaid tax liability, for each day of delay. ç) Wrongful account keeping that does not affect the financial result is punished with a fine of 10 000 lekë. Complaining and execution procedures of the administrative measure shall be done according to Law No.7681, dated 4.3.1993 "For Administering Taxes and Duties in the Republic of Albania." PART IV WITHHOLDING TAX AT THE SOURCE OF INCOME Article 33 Withholding tax on income 1. All persons resident in the Republic of Albania, central and local government institutions, as well as any other person, recognized as such by the legislation in force, withholds tax at the amount of 15% from the following payments: a) Dividends, except for dividends defined in the first paragraph of Article 34 of this law;
b) profit distribution except for profit distribution defined in the second paragraph of Article 34 of this law; c) interests, except for interests of treasury bills and other bonds issued by the Council of Ministers before January 1, 1999 as provided for in the third paragraph of Article 34 of this law; ç) payments on copyright and intellectual property; d) payment for technical services and management payments; dh) payments for construction, installation, assembling or respective supervising work performed by the central or local government institutions, or an individual in the course of managing its business; e) payments for performance of entertainers, artists or sportsmen in a show or performance in the Republic of Albania and such payments made to legal persons or partnership that employ entertainers, artists or sportsmen or which arrange such shows or performances. 2. Nonresidents also are subject to the first paragraph of this article, relating to such payments made by a person with permanent headquarters in the Republic of Albania. 3. The first paragraph of this article does not apply to dividends and profit distribution defined in Article 26 of this law. 4. A nonresident taxpayer who earns income as that mentioned in points "d", "dh" or "e" of the first paragraph of this article, may be taxed in the same way as if this income were gained in the course of an activity undertaken by him through a permanent unit in the Republic of Albania. Article 34 Final retention of tax 1. A resident person who pays dividends to resident persons must withhold tax from dividend at the amount of 10%. This action is the final tax payable for that dividend and requirements of Article 8 and those of the second paragraph of Article 9 of this law shall not apply. This paragraph shall not apply if the person who benefits the dividend notifies his payer that the dividend is benefited for the activity he directs. 2. A resident partnership that distributes profits to resident persons must withhold tax for this distribution of profit in the amount of 10%. This action is the final tax payable for that profit distribution and requirements of Article 8 and those of the second paragraph of Article 9 of this law do not apply. This paragraph shall not apply if the individual who benefits a share of the profit notifies his payer that this part of profit is benefited for the activity he directs. 3. A person who pays to a resident individual an interest generated by a source within the Republic of Albania, a deposit in a bank or similar financial institutions, with respect to a savings
certificate, bonds or similar instruments, or similar compensations, withhold tax on that interest at 10%. This tax shall be the final tax payable relating to that interest and requirements of Article 8 and those of the second paragraph of Article 9 of this law do not apply. This paragraph does not also apply if the individual who benefits the interest notifies his payer that the interest is benefited for a business he directs. Article 35 Collection and registration 1. The payer of amounts, for the purposes of tax retention subject to Articles 33 and 34 of this law pays the withheld tax to the tax organ's account no later than the 15 th of the month following the month of the payment. 2. The payer of these amounts must record payments of taxes and tax withheld at the source of income and should make them available to the tax organ and to the person on behalf of whom the payment was done. PART V SPECIFIC PROVISIONS Article 36 Price transfer 1. When conditions are established or created among related persons in an activity, in their commercial or financial relationship which is different from what may exist among two independent persons, the tax organ may decide that income of one or more of these related persons include the profit that he or they may had gained if such conditions did not exist. 1. To ensure the right and effective application of this article, the tax organ may reach previously a conditional agreement with the persons that carry out an activity, which will specify that the particular conditions among related persons are not different from those that may exist among independent persons. Article 37 Crediting foreign tax 1. If during the taxable period a resident generates profits or income from sources outside the Republic of Albania, the personal income tax or profit tax payable by that resident for these profits or income should be deducted with that amount of tax payable on this profit or income.
The amount of foreign tax payable must be certified with authentic document as defined in the instruction of the Ministry of Finance. 2. The reduction of personal income tax or profit tax described in the first paragraph of this article must not exceed the tax payable on profit or income generated from a foreign source, if such income is generated in the Republic of Albania. 3. In the case of a taxpayer who is subject to profit tax, any tax reduction described in the first paragraph of this article is limited in the tax that should have been payable in the Republic of Albania calculated as though Article 27 of this law applied for each foreign country, relating to profits or losses generated from sources in that foreign country. 4. Tax reduction described in this article must be calculated in a specific way for each foreign country which is the source of income or profits. PART VI TRANSITORY AND LAST PROVISIONS Article 38 Transitory provisions 1. Tax to be withheld according to the first and second paragraph of Article 10 and Article 33 of this law shall be deducted from payments made after the date this law enters into force. 2. Buildings, constructions, and plants purchased before January 1, 1999 shall be depreciated on the basis of their historical cost. 3. Fixed non-incorporated assets purchased before January 1, 1999 shall be depreciated on the basis of their historical cost. If the remaining book value of registration of such assets in January 1, 1999 is less than 50% of their historical cost, the taxpayer is allowed to continue the depreciation according to Instruction no. 8, dated l2.2.1992 "For Depreciation Rates of Fixed Assets of Natural and Legal Persons." 4. Depreciation basis of computers, information systems, software products, and back up systems as well as all other assets of the activity purchased before January 1, 1999, for the taxable period of 1999, shall be the value of these assets in the general ledger on January 1, 1999, adjusted as it is described in Article 22, point (6) of this law. 5. Taxable profit for the taxable period 1999 and 2000 will be reduced by losses the taxpayer suffered before January 1, 1999, and will be calculated according to Article 8 of Law no. 7677, dated 3.3.1993 "For Profit Tax", if these losses are registered in the profit declarations for 1998. Losses suffered during 1996 and 1997 cannot be carried over.
6. Taxpayers who are subject to tax incentives, according to Law No. 7677, dated 3.3.1993 "For Profit Tax" enjoy such incentives according to the conditions provided for by the abovementioned law. Article 39 Abrogation of existing legislation 1. Law no. 7786, dated 27.1. 1994 "For Personal Income Tax", including relevant changes, as well as all other acts which are not in compliance with this law shall be abrogated. 2. Law no. 7677, dated 3.3.1993 "For Profit Tax" including relevant changes, as well as other provisions which are not in compliance with this law shall be abrogated. Article 40 Sub-legal acts The Ministry of Finance is required to issue sub-legal acts to implement this law. Article 41 Date of effect This law enters into force fifteen days after the publication in official Gazette. Proclaimed with Decree No. 2289, dated 31.12.1998 of the President of the Republic of Albania, Rexhep Meidani. Table No. 1 Income Tax Personal Income Tax (Per month) Above Up to Lekë Percentage (in lekë) (in lekë) 0 10,000 Threshold 10,000 + 20,000 0 + 5% of amount above 10,000
20,000 + 30,000 500 + 10% of amount above 20,000 30,000 + 50,000 1,500 + 15% of amount above 30,000 50,000 + 80,000 4,500 + 20% of amount above 50,000 80,000 + 120,000 10,500 + 25% of amount above 80,000 120,000 + More 20,500 + 30% of amount above 120,000 Table No. 2 Selling Price Above (in lekë) Up to (in lekë) Payable Tax Percentage 0 2,000,000 0,5% of the selling price 2,000,000 + 4,000,000 1% of the selling price 4,000,000 + 6,000,000 2% of the selling price 6,000,000 + More 3% of the selling price