After the taxation of free professions / Lawyers increase their fees by up to 20%, an increase is also expected from dentists and psychologists

2024-05-10 07:25:00, Ekonomi CNA

After the taxation of free professions / Lawyers increase their fees by up to

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In addition to the debates about the incorrect application of the income tax law, some self-employed businesses have started applying higher fees for the services provided.

Lawyers warned earlier that their involvement in progressive taxation will hit them for the second time, after the changes to the new judicial map for the redistribution of courts come into force, which would be reflected in the increase in fees.

Lawyer Përparim Caca claimed for Monitor that due to the high tax, the fees for representation in court by lawyers have increased by an average of 15 to 20%.

"Specifically, if previously the fees for representation in civil trials from 45,000 ALL that cost have now become 60,000 ALL (a 33% increase)", he says.

According to him, an increase of up to 20% in fees is expected for other services provided, such as by dentists, psychologists, etc.

With the new law, the net profit of businesses is taxed at rates of 15 and 23%, calculated from the difference between annual income and expenses. The calculations of the tax administration for the 9 installments and prepayments were based on the declarations of businesses for the income and expenses of 2023. The law included for the first time the recognition of expenses a priori. For commercial individuals and the self-employed with a turnover of 10 million per year, in the free professions the a priori recognition of expenses was at the rate of 30%.

The application of the law resulted in the fact that the business was not given the opportunity to choose the special regime for the recognition of a priori expenses, provided for in the law, in the first year of implementation.

"Many freelancers have problems documenting expenses. For example a lawyer is not aware of fuel expenses, where 10 liters of fuel per day or 60,000 ALL per month are spent for transportation to the courts. For this profession, only the expenses for the chancellery are known, which are in low values.

Also, deciding to pay tax in advance, when none of us knows how much income we will make for the current year, is wrong. The law on income tax completely affects the middle class", says lawyer Përparim Caka.

Regarding the recognition of expenses with declarations for 2023, many businesses claim that they have declared them low, due to the difficulties they encounter in documenting them, as well as the lack of tax responsibility. While the economists claimed that they were informed that the deduction of fixed expenses, which could not be declared through the old declaration forms, due to the impossibility of the model, would be applied as a deduction by the tax administration.

After the calculations of the tax prepayment installments by the tax administration, it has been clarified that the a priori expenses of 30% will be applied, after being selected as an option by the businesses, for the profit declarations of the year 2024, which are carried out on March 31, 2025.

The new law has already been appealed 4 times to the Constitutional Court, by the DP parliamentary group, another lawsuit has been sent by IKM and IEAKA, by lawyers and other professionals and by driving schools. The Constitutional Court has decided on June 18 to hold the first hearing of the first 3 lawsuits.

In a survey a few days ago that Monitor conducted with freelancers, most of them said that they will pass this tax mainly to the prices of services.

38% of respondents said they would be forced to raise prices, 26% said they would sacrifice net profit, and 4% said they would cut operating expenses. Many others are seriously considering not only closing the activity, but also emigrating, which was the choice of 23% of respondents. Specifically, 17.5% of the respondents said that they will close or suspend the activity, while another 5.4% said that in addition to closing the business, they would leave the country./ Monitor Magazine