Albania is preparing a new fiscal package for 2026, and even though the final draft hasn’t been released yet, we already know the main areas the government plans to update. Most of these changes come from the country’s 2024–2027 revenue strategy, which aims to simplify the tax system, reduce exemptions, and bring several rules closer to EU standards.
Here’s what’s expected to change next year.
VAT: Fewer Exemptions and a Review of Reduced Rates
The biggest changes are expected in the VAT system. For years, certain sectors have benefited from special VAT exemptions or reduced rates. Some of these were introduced a decade or more ago, especially to support big investors at a time when VAT refunds took months or even years.
Today, VAT refunds are processed much faster, so many of those old exemptions are considered unnecessary. This means several industries that benefit from special VAT relief could lose it in 2026.
Reduced VAT rates are also being reviewed. Sectors such as tourism, books, advertising services in audiovisual media (all taxed at 6%), and agricultural inputs (taxed at 10%) may see adjustments. The government and the IMF have already completed an analysis to evaluate whether these reduced rates should remain or be brought back to the standard 20%.
Excise Duties: Alcohol, Tobacco, and Industry Exemptions
Excise taxes are another area where the government plans to intervene. One of the priorities is updating rules around alcoholic beverages produced for personal use. Small producers of wine or rakia can currently keep a certain amount without paying excise duty. That limit is expected to be reduced in 2026, meaning more of their production could become taxable.
The government also plans to unify excise levels for products that still have different rates within the same category and gradually align excise rules with EU minimums. This may lead to higher excise duties for some goods.
Another planned change is the removal of excise exemptions and refunds in certain industries. Instead of these exemptions, the government intends to offer direct subsidies, which it considers clearer and more transparent.
For tobacco, the previously approved 2022–2026 excise increase schedule continues. Since 2026 is the last year of the plan, another rise in cigarette prices is expected.
Why These Changes Are Happening
The overall goal is to modernize the tax system and avoid having too many special rules that benefit only certain sectors. Albania is trying to make tax policies simpler, more consistent, and more aligned with EU practices.
Who Will Feel These Changes
Businesses that rely on VAT exemptions or reduced VAT rates will likely be the most affected. Tourism, agriculture, media, and companies that import machinery or specialized equipment should pay close attention to the 2026 fiscal package once it is officially published.
Small family producers of wine and rakia may also feel the impact of the new excise rules.
For individuals, the most noticeable change may come from price adjustments, especially in products like tobacco and certain alcoholic beverages.
Final Thoughts
While we are still waiting for the final 2026 fiscal package, it seems like fewer exemptions, more uniform rules, and stronger alignment with EU tax standards are expected.
As soon as the Ministry of Finance releases the full version, it will be much easier to see which sectors are affected the most and what businesses should prepare for.
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