How have municipal revenues changed in 10 years? - Taxes that account for the main share in local budgets
Municipalities have significantly increased their revenues over the past decade. During the ten-year period 2015–2025, the fiscal performance of local self-government units is considered one of the most important developments.
Its revenues increased by 248% from 2015 to 2025, from 11.7 billion lek in 2015 to around 40.9 billion lek in 2025.
This dynamic reflects the expansion of the local revenue base, the improvement of collection capacities, and the effects of the fiscal decentralization reform.
Along the same lines, non-tax revenues have also increased, albeit at a more moderate pace. They have increased from 2.3 billion lek in 2015 to 3.9 billion lek in 2025, indicating progress in the management of local services and tariffs.
The main sources of revenue for 2025 are the real estate tax, which accounts for 18% of total local revenues, and the infrastructure impact tax from new construction, accounting for 37%, (with Tirana Municipality alone collecting 40% of this tax), the cleaning and hygiene fee accounting for 13% of total local revenues.
The infrastructure impact tax represents the most significant increase (+1057%), going from 1.4 billion lek to 16.4 billion lek. This indicates a significant increase in construction activity and an increasingly important role of this tax as a financial source for local governments. However, due to the cyclical nature of the construction sector, the high dependence on this tax poses risks to the medium-term sustainability of revenues.
The wealth tax has increased by +146%, specifically from 3.3 billion lek to 8.1 billion lek, however, its share remains relatively modest compared to the potential.
The cleaning and hygiene fee has increased by 263%, jumping from 1.6 billion lek to 5.9 billion, and the fees for occupying public spaces by +252%, which indicates an expansion of public services as well as an increase in operating costs.
The hotel accommodation tax has increased from 98.6 million lek to 736 million lek or +646%, reflecting the expansion of tourism activity and the improvement in the level of formalization in the accommodation sector.
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