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8.1.1. Corporate Income Tax

The standard corporate tax rate is 15% for taxpayers with an annual turnover exceeding ALL 14 million. Effective 1 January 2021, the rate is 0% (previously 5%) for taxpayers with a turnover of up to ALL 14 million.

Micro & Small Businesses

Effective 1 January 2021, small and micro businesses with an annual turnover of up to ALL 8 million (ALL 5 million until 31 December 2020) are subject to simplified income tax at the rate of 0%.

Previously, small taxpayers with annual turnover between ALL 5 million to ALL 14 million were subject to tax at the rate of 5% until 31 December 2020, and micro-businesses with an annual turnover of below ALL 5 million were taxed at 0%.

Capital Gains

Capital gains from the disposal of assets, including shares, buildings, land, and agricultural land, are subject to tax at the standard rate of 15%.

Effective 15 February 2021, new rules regarding re-organization are introduced that provide for the partial transposition of the EU Merger Directive. Under the new rules, capital gains tax that arises from the transfer of assets and liabilities in a re-organization is deferred until their disposal by the acquiring company. The deferral is subject to certain conditions and applies to mergers with absorption, transfer of a branch or branch of activity, mergers and divisions, where the transactions occur between Albanian tax resident companies (see Sec. 11.).

Automotive Industry

Effective from 1 January 2020, companies operating in the automotive industry are subject to a reduced corporate tax rate of 5%.

Petroleum Industry

A specific tax regime applies to the petroleum industry. See Sec. 10.

Other Specified Activities

Companies engaged in certain specified industries/ activities that are eligible for tax incentives, reduced corporate tax rates, or special tax regimes are given below (see Sec. 10.).