Albanian citizens will be paying more taxes on their homes, businesses, and other property, starting from April 2018.
According to the fiscal changes approved in December 2017 by the Rama government, property tax will be now calculated as a percentage of the property value, instead of being a fixed amount, as it has been until now.
These taxes will now be collected by and go to the local government.
How will the property tax be calculated?
Taxes on homes, businesses, garages, and warehouses will be calculated as a percentage of the average fiscal price.
This value has been determined by the Rama government during the property reassessment process completed in May 2017.
These prices vary for different areas of Tirana and are used by the Asset Registration Offices for the selling or buying of properties.
In practice, Tirana has been divided in 11 different areas, further subdivided according to cadastral zones, with prices varying from 60,000 lekë per sq.m. to 190,000 lekë per sq.m.
The property tax for apartments is 0.05% of the average fiscal price of the area where it is located.
The property tax for garages, mainly located in underground floors, is 0.02% of the average fiscal price of the area.
The property tax for businesses is 0.15% of the average fiscal price of the area.
In practice, for most families in Tirana, property taxes will increase. At the same time, the garage tax will be added, as it did not exist before.
How much did we use to pay for an apartment and how much are we paying now?
Property tax for homes, until 2017, was 15 lekë per sq.m. for homes built before 1993, and 30 lekë per sq.m. for those built after.
Therefore, a family living in a 100 sq.m. apartment located anywhere in Tirana used to pay 1,500 lekë per year if the apartment was built before 1993, or 3,000 lekë per year if it was built after 1993. This tax was spread out throughout the year and paid every month.
By the new formula, a family living in a 100 sq.m. apartment built after 1993 in the Komuna e Parisit area (where the reference price is 107,000 lekë per sq.m.) now will have to pay 5,350 lekë per year, instead of 3,000 per year, leading, thus to a 2,350 lekë increase.
If the same 100 sq.m. apartment would be used as a place of business, the property tax would be 16,050 lekë per year.
If the family also owns a 15 sq.m. garage, then it has to pay 3,120 lekë per year property tax on it, as well.
The family would only be able to escape this tax hike if their 100 sq.m. apartment would be located in one of the areas where the reference price is 60,000 lekë per sq.m. (Porcelan, Kinostudio, Linzë, Bregu i Lumit, Allias, 5 Maji), in which cases their new property tax would still be 3,000 lekë per year, as it was before. For all the other citizens of Tirana, property taxes in 2018 will increase.
