Analysis of Albania’s Tax System

Analysis of Albanias Tax System INTRODUCTION Every one can make the question: â€Å"why do we have taxes?†.Practically we can say , that one democratic state can not exist without taxes, even if he does not operate just with taxes.Taxes and taxability are a necessity. The standard of living of a modern society demands it; governments must collect the revenues in order to provide the goods and services that their citizens need, want and demand. The principal sources of Albanian tax legislation are the Constitution, various laws and decrees. The Parliament is the prime taxing authority in Albania, while the Ministry of Finance is the executive branch, responsible for administration of the laws. There is an important difference between tax and taxability in Albania.Taxability is an obligated and irreversible payment in state budget which include administrative charges and penalties for the delays provided by law. They are obligated payments of different contributors used for general public services, in that wa y state can accomplish his duty. While tax is an obligated contribute to pay from one person who profits directly from public services. They are a type of compensation for special public services accomplished from state in advantage of citizen. Taxes are mostly resource of locale organs entries of state, city halls, communes . Taxes for public services which we pay for has the element of volition, wich can not happen in no case with taxability. In financial point of view the taxes role is little than taxability ,so the role and the importance of taxes in confronting expenses for the public services is more sensible in the local budget than in the national budget. The following project aims to treat with no details the types of taxes and taxability in the Republic of Albania,their importance and influence in the economy.Often the country’s financial authorities have been propagating that tax levels in Albania are among the lowest in the region so in another section we will sti ck to the comparative analysis of tax burden. We will try to compare it with Macedonia and Greece. This article is structured as follows: First, we will briefly review the types of taxes and taxabilities in Albania. Second we will try to analyse and compare their importances in economy of our country with Macedonia and Greece. Finally, chapter four provides a summary and the conclusions on the issues treated.    OVERVIEW ON TAX SYSTEM IN ALBANIA In the following section we will briefly review the classification of taxability and taxes in Albania.1 1 This section is based mainly on a summary of tax system in Albania presented by Financat (2006). 2.1 Taxes 2.1.1 National Taxes National Taxes cover 23% of the income that the state recieves from the taxes system,that is why they are considered very important to the Government’s budget.Among the main national taxes,we can mention Road Traffic Tax,Higher Education Tax and Registration fee for Poker Games, Casinos, for sport compe titions taking place at the racetrack.Road Traffix Taxes include taxes imposed by the Government for the use of imported vehicles ,also the old ones,for the fuel consumption etc.The universities and other Academies are charged with the collection of Higher Education Tax.These taxes are cashed not later than 30 days from the official date of the beginning of the school year, in any academic year.While the tax on registration of gambling, casinos for sportive races held in hippodromes is payable only once at the beginning of such activities and their registration.