The Tax Administration has announced that foreign companies providing electronic services to individuals or businesses not registered for VAT in Albania are obligated to register for tax purposes and pay VAT on these services.

This requirement is part of efforts to enhance transparency and broaden the tax base, as outlined in the Medium-Term Revenue Strategy.

According to the General Directorate of Taxes, foreign companies offering online services such as telecommunications, radio, television, web hosting, software maintenance, downloading films, music, games, and online courses must appoint a tax representative in Albania, register for VAT, and declare and pay VAT for any services offered to individuals or businesses not registered for VAT in the country.

However, if the services are provided to a business that is already VAT-registered in Albania, the VAT liability will fall on the Albanian business through the self-assessment system, not the foreign company.

The Tax Administration emphasizes that this notice aims to raise awareness and encourage voluntary compliance with tax obligations, ensuring a fair and competitive market for all.

The General Directorate of Taxes has also warned that if these companies fail to meet their legal obligations within a reasonable timeframe, they will face all legal and administrative actions as prescribed by Albanian law.