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Household Tax Compliance in Albania

Author

Listed:
  • Edward Christie
  • Mario Holzner

    () (The Vienna Institute for International Economic Studies, wiiw)

Abstract

This paper applies a set of indicators of tax compliance to the household sector in Albania. These estimates are performed using available data for the years 1996 to 2003. Estimates of income declaration rates and of corresponding undeclared household income are computed using household final consumption data from national accounts and household survey data as well as detailed data on household taxation. Specific aspects such as remittances and the role of agriculture are explicitly taken into account and discussed. Our results show that household tax compliance in Albania is low by European standards. Although compliance overall has recovered from the collapse of 1997 and revenues have increased, the compliance rates for personal income tax and for social security contributions have significantly worsened in 2002 and 2003. This seems to be due to a disconnect between the formal goals set out as legislation and the revenue collection targets set by the relevant agencies.

Suggested Citation

  • Edward Christie & Mario Holzner, 2005. "Household Tax Compliance in Albania," wiiw Research Reports 316, The Vienna Institute for International Economic Studies, wiiw.
  • Handle: RePEc:wii:rpaper:rr:316
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    File URL: https://wiiw.ac.at/household-tax-compliance-in-albania-dlp-326.pdf
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    References listed on IDEAS

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    1. Vladimir Gligorov & Mario Holzner & Michael Landesmann, 2003. "Prospects for Further (South) Eastern EU Enlargement: Form Divergence to Convergence?," wiiw Balkan Observatory Working Papers 30, The Vienna Institute for International Economic Studies, wiiw.
    2. Friedrich Schneider & Dominik Enste, 1999. "Shadow Economies Around the World - Size, Causes, and Consequences," CESifo Working Paper Series 196, CESifo Group Munich.
    3. Edgar L. Feige, 2005. "Overseas Holdings Of U.S.Currency And The Underground Economy," Macroeconomics 0501022, EconWPA.
    4. Edgar L. Feige, 2004. "How Big IS the Irregular Economy?," Macroeconomics 0404005, EconWPA.
    5. Kaufmann, Daniel & Kaliberda, Aleksander, 1996. "Integrating the unofficial economy into the dynamics of post-socialist economies : a framework of analysis and evidence," Policy Research Working Paper Series 1691, The World Bank.
    6. Lorenz Jarass & Gustav M. Obermair, 2000. "Taxation Systems in Estonia, Poland, Hungary, the Czech Republic and Slovenia," Taxation Studies 0004, Directorate General Taxation and Customs Union, European Commission.
    7. Allingham, Michael G. & Sandmo, Agnar, 1972. "Income tax evasion: a theoretical analysis," Journal of Public Economics, Elsevier, vol. 1(3-4), pages 323-338, November.
    Full references (including those not matched with items on IDEAS)

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    Cited by:

    1. Edward Christie & Mario Holzner, 2006. "What Explains Tax Evasion? An Empirical Assessment based on European Data," wiiw Working Papers 40, The Vienna Institute for International Economic Studies, wiiw.

    More about this item

    Keywords

    tax compliance; tax evasion; national accounts; household sector;

    JEL classification:

    • H26 - Public Economics - - Taxation, Subsidies, and Revenue - - - Tax Evasion and Avoidance
    • H31 - Public Economics - - Fiscal Policies and Behavior of Economic Agents - - - Household
    • P37 - Economic Systems - - Socialist Institutions and Their Transitions - - - Legal

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