New tax regime effects on Local Government Units Case study Vlora Municipality

Abstract

Objectives: The primary purpose of the paper is to understand the impact of the territorial-administrative reform from 2015-2020 in Albania, especially in the Vlora Municipality. Prior Work: The debate over the benefits and consequences of decentralization has been ongoing for the past two decades. Decentralization has been used as an instrument of democratization in many developed and transitional countries. Only a few research papers are done to evaluate the impact of the reforms in Albania. The implementation of the reform started in 2015, and it is probably too early to discuss the outcomes. Approach: The analysis represents a single case study on the territorial-administrative reform in Albania. Results Implications: The reform has not generated the expected results in the Vlora Municipality and the overall Albanian economy. The most substantial portion of local government revenue still comes from the central government’s unconditional transfers. Value: This paper is one of the first that attempts to evaluate the impact of the reform in the Vlora Municipality. The study aims to serve as a tool for improving local government capacity and recommendations responding to citizens' requests for greater efficiency in public spending