Anyone who rents out their home daily will pay taxes to the Municipality of Tirana as a business.

All accommodation structures operating on a daily basis (B&B, guesthouses) will have to pay the educational infrastructure tax and the cleaning fee, depending on annual turnover.

A draft decision "On some additions and changes to the system of local taxes and fees in the city of Tirana" proposes the addition of other categories of businesses for the purpose of calculating the educational infrastructure tax and the cleaning fee.

"In the item Hotels, motels, the item "B&B", guesthouses as accommodation structures that operate on a daily basis, should be added," the report states. Previously, this tax only included hotels and motels (lek/room per year).

How will the obligation for the local cleaning fee and the Educational Infrastructure tax be calculated according to the turnover distribution for daily rental structures?

According to decision no. 158, dated 26.12.2019 "On the approval of the system of local taxes and fees in the city of Tirana", the Educational Infrastructure Tax and Cleaning Fee is calculated as a fixed annual obligation, but varies according to the category of business turnover.

Until now, for service units, the cleaning fee is paid only by hotels and motels. For example, the cleaning fee for a business in the category of service units hotels and motels with an annual turnover of 0 to 2 million lek, the cleaning fee is 5,750 lek per year.

With the proposal of the Municipality of Tirana, this tax will also be paid by Bed and Breakfast structures, or as they are otherwise known, B&Bs (unlike hotels, B&Bs are usually family or private businesses with few rooms) and by guesthouses. So if their annual turnover is up to 2 million lek, the obligation for the cleaning fee will be 5,750 lek per year. The obligation will be the same as motels and hotels with an annual turnover of 2 million lek.

For businesses with a turnover of 2 to 8 million lek, the annual fixed cleaning fee is 11,500 lek. In addition to the fixed fee, businesses in this turnover range pay an additional 1,150 lek per room. So if a hotel or motel has 5 rooms, it pays an annual fee of 11,500 lek as a fixed annual fee + 5 rooms x 1,150 fee/room = 17,250 lek per year.

Even for service businesses, included in the category of turnover over 8 million lek, the cleaning fee is calculated using the same formula. For this category, the annual fixed tax is 34,500 lek per year. While per room, it is 1,725 ​​lek, which is added to the obligation of 34,500 lek.

And for VIP businesses, the cleaning fee per room is 2,900 lek plus a fixed annual fee of 69,000 per year.

While the temporary educational infrastructure tax for service units with annual turnover from 0 to 2 million lek is 2,500 lek per year.

For businesses with a turnover of 2 to 8 million lek, it is 4,000 lek per year. For businesses categorized with a turnover of over 8 million lek, the fee is calculated at 17,000 lek per year. And for VIP businesses, the fee is calculated at 32,000.

The draft decision also proposes other changes to Annex 6, namely in the category "Retail sale" under the item Sale of pharmaceutical and similar products (pharmaceutical warehouses registered as small businesses), to remove the phrase (pharmaceutical warehouses registered as small businesses).

Pharmaceutical warehouses, due to the volume and typology of the activity, cannot be registered in the retail sales division. It is proposed to remove it from this item by including it in the item: “Warehouses, shops, pharmaceutical warehouses, etc., which carry out wholesale sales”

It is also proposed that the service units carpenter, tailor, shoemaker, hairdresser, watchmaker, etc. be added for clarification, "painter and similar plumbing work" since this category cannot be classified as construction entities.

Meanwhile, in the item: Non-public educational institutions (schools, kindergartens or nurseries), services in clinics of various medical specialties, services in diagnostic laboratories, etc., in cases where they do not exceed the VAT registration threshold, the last part should be removed, as the division according to turnover and VIP category conflicts with this type of formulation./ Monitor