A growing group of Italian retirees living in Albania has written an open letter to Albanian Prime Minister Edi Rama, urgently asking that their foreign pensions not be subjected to a proposed 15 % tax under new fiscal rules — an idea that has spread anxiety and uncertainty among roughly 3,000 expatriate pensioners.
The controversy stems from changes to Albania’s tax code that have altered the treatment of foreign income for residents. Under the 2019 fiscal regime, citizens of European Union countries, including Italians legally residing in Albania, were effectively exempt from local income tax on foreign pensions if they maintained regular residence. This exemption was interpreted as a major incentive for retirees choosing Albania as a low-cost retirement base.
However, a revised law that came into effect in January 2024 eliminated the broad, automatic exemption enjoyed by EU pensioners, leaving tax protection only for income covered by specific international agreements. Although Albanian tax authorities have not yet formally imposed the new 15 % tax on Italian pensions during 2025, the fear that it could soon be applied has prompted many retirees to seek urgent clarification.
In their letter, the group warns that such a tax would dramatically reduce their monthly income — which currently averages about €3,500 — and that many might consider relocating to more tax-friendly countries such as Slovakia, Hungary or Croatia if the change is implemented. They argue that this would have knock-on effects for local economies, as foreign pension income flowing into Albania’s markets, restaurants, property rentals and services currently amounts to more than €136 million annually.
The retirees have been trying to navigate the confusing post-reform environment, with many approaching local tax offices and CAF assistance centers (Italian tax filing intermediaries) for clear guidance — but so far have encountered contradictory and unclear responses. The lack of reliable information has fueled nervousness within the community.
For Albania, the issue highlights the broader challenge of balancing revenue-raising reforms with the country’s growing appeal as a destination for foreign retirees. Previous international coverage has noted Albania’s relatively low cost of living and favorable conditions for long-term residence as attractive factors for older expatriates and holiday-home seekers alike.
Officials in Tirana have not yet publicly committed to abolishing the feared tax, but the pensioners’ letter signifies a rising mobilization of foreign residents seeking reassurances that their retirement income will remain protected. As negotiations continue, tens of millions of euros in foreign pension flows — and the retirees who depend on them — hang in the balance.