The project of electronic fiscalization in Albania

Since January 1, 2021, one of the biggest reforms undertaken by the Albanian Tax Administration – the project of electronic fiscalization, has started. This new system, which has created a mechanism for real-time supervision of fiscal equipment operating with cash and also cashless, has brought to the Tax Administration in Albania effective control and accurate and in-depth analysis of tax-relevant data, including risk criteria. The approach of the Tax Administration is to orient towards a smart administration, focusing more on control from the office.

Referring to the new developments brought by the law, the Tax Administration informs the taxpayers that the procedures that will be followed based on the Risk analysis which is:

• Analysis of taxpayer data and trends in various sectors of the economy by monitoring sales and financial reports from the office by well managing human resources;
• Risk assessment for all taxpayers will be assessed and ranked with low, medium, and high risk based on income reports, purchases, expenses, employee numbers, and salary levels.

Low-risk taxpayers will be sent notices detailing the concerns and encouraging improved returns. Medium-risk taxpayers will be interviewed to encourage the improvement of their declaration. Meanwhile, for high-risk taxpayers, the controls will be period-oriented based on risk analysis. The first period which is applied is two years and if the findings (on-site control) will result in repeated phenomena, events, and perceptions, the control will be extended for a period of five years.

These procedures are in line and in full compliance with the recommendations of the IMF as well as international best practices, with which the General Directorate of Taxation in Albania has close cooperation. In fulfillment of its legal and functional obligations, the Tax Administration has taken all measures to implement and comply with applicable legal provisions. This process, which is considered very important, considering the taxpayer as a partner, also requires cooperation by mutually supporting the parties that are involved in law enforcement.