Could fiscal amnesty reduce informality? The case of Albania

Purpose: Fiscal amnesty is a policy tool that has been used in various countries as a means to reduce the level of informality in their respective economies. It’s been successful in some countries, but not always. As a measure against informality, the Albanian government has recently proposed the law for fiscal amnesty. The purpose of this paper is to conduct an analysis of the factors that could lead to the success of fiscal amnesty programs and to identify the ways on which this measure can succeed to reduce the level of informality in the Albanian economy. Methodology: A qualitative approach was adopted to analyze the appropriate data, policy documents and reports relevant to this study. Findings: The findings among other things, showed that the economic and political context, as well as the previous experience of fiscal amnesties in Albania, do not guarantee an effective and appropriate solution for Albania, such as the fiscal amnesty. Value: By evaluating the economic and political context and program design, together with the long-term impact of the fiscal policy programs in Albania, this paper contributes to an ongoing discussion of the factors that could lead to a successful fiscal amnesty.