Tourism boom increases rental income - 53 million euros in tax paid in 2024, impact of AirBnB and Booking
The increase in the number of tourists from year to year has led to more properties being put on the market by citizens, being rented out for short-term through AirBNB or Booking platforms. Also, the prices of long-term monthly rentals have increased significantly during the past year, bringing more benefits to citizens but also to the state budget.
Official data from the General Directorate of Taxes shows that the tax collected from rents in 2023 was recorded at around 48 million euros, while in 2024 it went to 53 million euros. The increase is recorded at around 5 million euros or 10.3%.
The increase is considerable, despite the fact that the rental market has problems with informality and not everyone declares it. In October of last year, the tax administration imposed an obligation on businesses to declare the ownership status or lease contract of the premises where they carry out economic activity.
But what is the tax rate paid on rent? According to the current law "on income tax", income from real estate rentals is treated as income from investments and the tax applied at source is 15 percent of the monthly rent value. So if the rent is worth 50 thousand lek per month, the tax that must be paid is 7500 lek per month.
In the case where an individual has leased property to a registered entity, the latter is responsible for withholding, declaring and paying the withholding tax on behalf of the tax authority. When the lessee is an unregistered person, as in the case of domestic or foreign tourists, the lessor individual, as the beneficiary of the income, is obliged to declare and pay the withholding tax to the tax authority no later than the 20th of the month following the month in which the payment was made.
During this year, the Albanian tax administration has started a collaboration with the Irish tax administration to investigate individuals who benefit from income from the Booking and AirBnB platforms and do not declare them. While it has asked individuals to make the relevant declarations through DIVA. Data from the short-term rental accommodation market shows that currently on various booking platforms, there are over 18,200 active short-term rental units.
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