Despite the fact that the government made an early business demand for VAT reduction in tourism, the IMF continues to argue that this measure will have no effect in the economy.
IMF representative in Tirana, Jens Reinke, thinks that this measure it’s risky, as the escalation of this tax undermines the system.
In a sector where informality continues to be high, IMF thinks the impact of this initiative will be negligible.
“We have had long consultations with the government, but also with the interest groups on the VAT level. We have given our advice. Reduction of this tax undermines the VAT system, which also gives the main contribution to revenue collection. But on the other hand, we see that it is not expected to have an effect on the economy. The tourism sector is growing, its revenues also, but the collection of taxes from this sector continues to be poor. We think that the government should focus on its work in this aspect, “ Jens Reinke said for Vizion Plus.
