Markets
Rama: Circulation tax scrapped from diesel and gasoline, pump price to fall 32 lek a liter
The 27-lek-a-liter tax, in place since 2011, will be shifted to vehicles and collected through road transport. Foreign cars entering Albania will pay a circulation tax.
By ANN Newsroom · Newsroom
October 28, 2026, 16:18 · Updated 18:43 · 1 min read
In brief
- Rama announced the removal of the circulation tax from fuel as part of the 2027 draft budget.
- He said the pump price will automatically fall by 32 lek a liter, about 35 cents.
- The tax moves to vehicles, with a heavier burden on luxury cars and electric cars included as well.
Prime Minister Edi Rama announced that the circulation tax will be removed from the price of diesel and gasoline as part of the 2027 draft budget. “We will remove the circulation tax from the price of diesel and automatically lower it by 32 lek at the pump,” Rama said, adding that the tax will be shifted to vehicles and collected through road transport.
He also said that, “as Europe does,” foreign cars entering Albania will pay a circulation tax.
How the price is built today
According to an analysis by Top Channel, every liter of diesel now carries about 39.4 lek in excise duty, 27 lek in circulation tax and 3 lek in carbon tax, with 20% VAT applied on top. That is why removing the 27 lek, together with the VAT charged on it, could in theory cut the final price by about 32.4 lek. How much of the cut is actually felt depends on how much retailers pass on to sale prices.
The tax was introduced in 2011, when it was moved from a fixed annual charge to fuel consumption. It started at 5 lek a liter, rose to 27 lek in 2015 and has stayed unchanged since then.
Who covers the loss
The circulation tax brought in an average of about 21.7 billion lek a year in 2023–2025 and about 24.2 billion lek in 2025 alone, according to Top Channel. To offset the loss, the government plans to raise taxes on vehicles, especially luxury cars, which will also face a super tax, while electric cars will be brought into the scheme as well.
