Implementation of new real estate tax postponed by 2 years, expected to start in 2028

2025-10-06 07:10:28, Ekonomi CNA

Implementation of new real estate tax postponed by 2 years, expected to start in

The implementation of the new real estate tax, which was planned to come into effect in 2026, will be postponed for another two years and is expected to begin in 2028.

The Ministry of Finance reports that a completely new draft law is being drafted, which will be approved in 2026, and will begin to be implemented together with the Fiscal Cadastre from 2028. The postponement comes after the consultations and preparations necessary to build a new taxation system, which will be based on the market value of real estate.

The previous draft law, published for public consultation in 2023, provided that the new taxation would begin for buildings in 2026 and for plots, land and agricultural land in 2028.

According to the 2023 proposals, the tax level would be:

From 0.1% to 0.2% for residential buildings (currently 0.05%),

From 0.15% to 0.25% for commercial buildings (currently 0.2%),

From 0.15% to 0.25% for agricultural and industrial buildings.

It is learned that the new draft that is being drafted is not expected to change the building tax coefficients for land and agricultural land proposed in 2023, which brought the tax rate closer to countries in the region.

According to the report, the draft, which was drafted in 2023, aimed to transition from a value-based taxation system for buildings and a simple area-based taxation system for land, to a modern taxation system that taxes both buildings and land, based on the market value of these assets.

It was envisaged that the value of real estate would be determined on a new map with average reference prices, but separated for residential and service building units, as well as average reference prices of parcels, including land, agricultural and forest land. Rather, the tax base would be supported by property valuation through sales contracts and market prices, creating new zones for real estate values.

Although the proposed formula for calculating the building tax for the first apartment provided for a 50% discount on the value, the proposal to double the rate (from 0.05 to 0.1 to 0.2%) would increase the payment of duties. With the examples published by the Ministry of Finance at the time with the document “Property Tax Reform 2024-2028” it increased the duty for residential buildings from 18 to 50% and for shops up to 28%.

BUILDING TAX RATE

Current tax rate:

0.05%, for the building/property unit that is used for residential purposes;

0.2%, for the building/property unit that is used for economic activity;

30% of the relevant tax rate, for the entire construction area, for which the developer has been provided with a building permit and has failed to complete it, according to the deadline set in the act approving the request for a building permit.

Tax rate proposed by the 2023 draft law

For all building units included in the residential property category, the tax rate may vary from 0.1% to 0.2%;

For all building units included in the category of agricultural - livestock properties, the tax rate may vary from 0.15% to 0.25%;

For all building units included in the commercial property category, the tax rate may vary from 0.15% to 0.25%;

For all building units included in the industrial property category, the tax rate may vary from 0.15% to 0.25%.

The tax rate for the unfinished building is 30% (thirty percent) of the tax rate for the relevant category of building./ Monitor.al