Illustrative picture by pixaby.com

Elona Zace is angry about the Albanian government’s decision to hike taxes on online purchases.

The 26-year-old is one of hundreds of thousand of Albanians who have discovered the joy of online shopping, using it on a regular basis mainly to buy clothing and accessories.

But after the government slapped a tax of 22.4 per cent on any online purchases above a value of 22 euros, she is wondering whether she will continue to buy online.

“It is really unfair. I always found real bargains online at a time when clothing prices in Albanian shops and malls are high and you almost never find a real sale,” she said.

She told BIRN that paying 24 per cent more for every item is way too much for her.

Other Albanians have taken to social networks to express anger over the decision, considering it a real blow to opportunities to purchase not only clothing but also books and tools for professional development.

The government took the decision to lower the non-taxable limit for online purchases by a factor of seven on Wednesday.

While people used to be able to buy goods for up to 150 euros online without any extra taxes, now they have to pay 20 per cent VAT plus 2.4 per cent customs tax if the value of the goods exceeds 22 euros.

The government has also lowered the limit on tax-free products that Albanian citizens can receive as gifts from friends and family outside the country. They now have to pay taxes on every gift that exceeds 45 euros in value, down from a limit of 145 euros.

That affects all people, especially the young, who use the internet to buy clothes, accessories, and other products under a value of 150 euros.

Statistics from the Albanian Bank Association show that online trade has grown rapidly in Albania in recent years.

Over 120,000 online transactions were conducted in Albania a month in the last four months. In April alone, the number reached 130,000.

Data showed the rise in online shopping as the volume of express post deliveries in Albania increased by 130 per cent.

Artan Gjergji, a financial expert, told BIRN that the government decision seemed rash and was taken without weighing the negative effects.

He said the government was “killing off” e-commerce in Albania at a time when this form of trade is expanding everywhere in the world.

“This initiative will discourage consumers and is at odds with the policies of the Albanian Central Bank, aimed at stimulating online transactions,” he said.

Gjergji believes the real motive is a short-term desire to collect more taxes from a sector that seems to be booming.

“I don’t expect the initiative to pay off because it will just reduce the level of e-commerce. On the other hand, it will also encourage tax evasion and make people use cash instead of online bank transactions,” he predicted.

In fact, the government has been pursuing contradictory policies over the non-taxable limit for online purchases.

In May 2014, the Ministry of Finance proposed raising the non-taxable limit on online purchases from around 75 to 150 euros, to stimulate e-commerce. Now the ministry has changed its mind.