In recent years, the IT services market in Albania for self-employed professionals has expanded, thanks to competitive tax reductions. However, with the introduction of higher tax rates compared to neighboring countries like Kosovo, as well as Estonia and Georgia, Albania is losing its competitive edge and strategic position in the Balkans for offering innovative services to Europe and the American market at a low cost.

Following the 15% taxation policy, many self-employed IT professionals with a passion for engineering are now considering relocating their businesses to countries with more favorable fiscal policies. Kosovo has emerged as a top choice for many of these professionals.

A recent survey revealed that 23% of respondents were contemplating closing their operations, with 17.5% planning to close or suspend their activities and another 5.4% considering both closing their businesses and leaving Albania. Among the preferred destinations for business relocation, Kosovo stands out due to its attractive fiscal policies.

Many self-employed individuals in the IT sector are choosing Kosovo for its more favorable tax environment, which provides a better landscape for growth and innovation compared to Albania’s current tax regime.

Lower Corporate Tax Rates

Kosovo’s corporate tax rate is significantly lower than Albania’s. This reduction in tax burden allows businesses to reinvest more of their profits into growth and development.

Simplified Tax Procedures

Kosovo has implemented simpler and more streamlined tax procedures, making it easier for businesses to comply with tax regulations. This reduces administrative costs and the time spent on tax-related matters.

Incentives for IT Sector

Kosovo offers specific incentives for the IT sector, including tax breaks and grants for tech startups and innovation-driven enterprises. These incentives make it an attractive destination for IT professionals looking to establish and grow their businesses.

Supportive Business Environment

The Kosovar government actively supports the growth of the IT sector through various programs and initiatives aimed at fostering innovation and entrepreneurship. This supportive environment encourages investment and business expansion.

Cost-Effective Operations

Operating costs, including labor and office space, are generally lower in Kosovo compared to Albania. This cost-effectiveness helps IT businesses manage their expenses more efficiently.

Strategic Location

Kosovo’s strategic location in the Balkans provides excellent connectivity to major European markets, making it easier for businesses to access a broader client base.

Favorable Legal Framework

Kosovo has a favorable legal framework for businesses, with laws and regulations designed to protect intellectual property and support the digital economy. This legal certainty is crucial for IT companies that rely heavily on innovation and intellectual property.

If you are interested in understanding how taxation functions in Kosovo or seeking a consulting partner for tax, audit, and legal services, we have years of experience as experts in this field. Don’t hesitate to reach out to us at office@talis.llc.