Prime Minister Edi Rama has said he will establish a board to set price caps on food items, and the moment a price goes higher, the state will intervene and remove their license.
The pledge comes as citizens protest over price rises they say are unsustainable and put more of the population at risk of poverty.
“You are people who were not born rich, you did not inherit from your family, you all started from scratch, you all saw difficult days of poverty,” Rama said in a public statement, while adding that intervening in prices goes against his ideology but in times of war, it is necessary.
He stopped short of meeting the demands of protestors. They include the removal of various taxes on fuel. Currently, government taxes account for 53% of the final cost.
They also ask for temporary suspension of VAT on basic food items, expanding the compensation and support scheme for farmers, a proper aid package for pensioners, the disabled, and families until the crisis is over, the investigation and supervision of concessions and expenditures from the state budget, as well as those that could manipulate the market.
Another group of protestors, students from the university, called for the abolition of excise duty on oil, temporary suspension of some other taxes, and the revision of the minimum sustenance level. They called for Rama to resign if these cannot be enforced by Friday.
If the demands are not met by Saturday, protestors said they will gather in large numbers and increase the scope of the protest.
The price of some 30 essential food items have increased by at least 20% since January of this year, with some increasing as far 50%, according to INSTAT, the Albanian statistics agency.
Based on analysis conducted by the body, on 15 March the items were selling at a price 20% more than just two months prior. The largest increases were found in oils, flour, and hydrocarbons.
In particular, cooking oil and butter saw the most significant increases. Butter is selling at 1000 lek (EUR 8.12) up from 682 lek (EUR 5.54) in January. One litre of cooking oil increased by 40% from 228 lek (EUR 1.85) to 330 lek (EUR 2.68).
Analysis shows that the state will be EUR 147 million better off due to the price rises from just the last two months alone.
During this time, customs revenues increased by 24.2% and tax by 19.4%. The biggest increase was seen in VAT revenue, with a 56% increase while VAT on imports was 30% more.
Rama also announced the government is considering removing energy expenditure protection measures from those who consume a lot or who have more means than other sectors of society. No further information was provided on how this may be achieved.
“We have now started to do a study to remove from this complete protection the families that consume a lot of energy because they live in very good conditions, but still are few. At present, no household has an increase in electricity,” he claimed.
