The Albanian parliament approved the Budget and Fiscal package for 2020 on 18 December 2019. Tax-related measures include the following:
- A reduced 5% corporate tax rate is introduced for activities in the automotive industry;
- The loss carry-forward period is extended to five years for companies investing in business projects with a value exceeding ALL 1 billion (the standard loss carry-forward remains three years);
- An increased deduction in introduced for the sponsorship of sports teams in legally recognized sports federations up to three times the sponsorship amount for companies with taxable profits exceeding ALL 100 million, provided that the company has obtained sponsorship authorization from the tax authority;
- It is clarified that the provisions of applicable tax treaties supersede domestic law with respect to the taxation of gains from the alienation of shares, including that the shifting of the tax liability to the company whose shares are alienated, as provided under domestic law, does not apply where a tax treaty covers the taxation of shares;
- A VAT exemption is introduced for new electric vehicles, although a 6% rate will continue to apply for electric vehicles with more than 9 seats used for public transport; and
- Qualifying exporters that have generated more than 70% of their income from exports in the past three years are allowed to deduct expenses for participation in fairs or expositions abroad up to 3% of their annual turnover.
The measures generally apply from 1 January 2020.