BlogEntrepreneurship & BusinessLegal ResourcesFiscal Package 2022: Minimum Wage Increases and Tax Rate Changes

January 5, 20220
http://blog.legit.al/wp-content/uploads/2022/01/Copy-of-Pronesia-Intelektuane_COffee-1080-x-1080-px.png

On the first official working day of this year, it is impossible not to chit-chat among colleagues that “the minimal salary is expected to be increased”.

 

What has happened?

 

The Fiscal Package 2022 amended the following laws

  • The Law no. 113/2021, On an amendment to the Law no. 8438, dated 28.12.1998, “On income tax”, as amended
  • The Law no. 111/2021, For some additions and amendments to the law no. 92/2014 “On value added tax in the Republic of Albania”, as amended
  • Law No. 114/2021, On some amendments and additions to the law no. 61/2012, “On excises in the Republic of Albania”, as amended
  • Law no. 112/2021, For some additions to law no. 9975, dated 28.7.2008 “On national taxes”, as amended

The non-taxable base has shifted from  30,000 ALL, to 40,000 ALL

Personal income tax from employment

Monthly income from salary Taxable monthly income Percentage tax rate / month
From To
From To
0 40 000
40 001 50 000
50 001 More
0 40 000
0

30 001

30 000

50 000 

0

30 001

200 001

30 000

200 000

More

0%
0 %

50%*13% of the amount over 30,000 ALL

0%
13% of the amount over 30,000 ALL
22,100 ALL + 23% of the amount over 200 000 ALL

 

  • Taxpayers with incomes up to 40,000 ALL will not pay income tax.
  • Taxpayers with incomes from 40,001 to 50,000 will pay income tax only on the amount over 30,001 ALL, which will be calculated 50% * 13% of the amount over 30 000 ALL.
  • Taxpayers with incomes more than 50,001 ALL will not be taxed on income up to 30,000 ALL.
  • The tax rate of 13% will be calculated only on the band 30,001 ALL – 200,000, while for incomes over 20,001, the tax rate will be calculated 22,100 ALL + 23% of the amount over 200,000 ALL.

In other words, the tax rate of 13% has been nominated for taxpayers with incomes from 40,001 ALL / month to 50,000 ALL / month. While the tax rate of 23% will be applied on salaries over 200,000 ALL / month.

 

For example

 

Jani earns  45,000 ALL per month.

Starting from this July, the tax rate will be calculated as in the table below:

Wage Monthly taxable income Monthly tax rate Income tax Total
45,000 0 – 30 000

30,001 – 45,000

0 %

50% * 13% of the amount over 30,000

0 ALL

50%*13%*15,000

975 ALL

The law no. 113/2021, For an amendment to the law no. 8438, dated 28.12.1998, “On income tax”, as amended, will extend its effects starting from July 1, 2022.

Until then, follow us for other legal updates by subscribing here.

Leave a Reply

Your email address will not be published. Required fields are marked *

http://blog.legit.al/wp-content/uploads/2020/12/logit-white-red-icon.png
Tirana, Albania & Pristina, Kosovo
+ 355 69 634 0059
info@legit.al

Follow us:

STAY INFORMED

Subscribe


Legit.al. Calls may be recorded for quality and training purposes.

Copyright © Legit 2020