From 1 June, a decision by the Tax Administration of Kosovo (TAK) has entered into force, prohibiting cash payments above €2,000 between businesses and individuals, requiring such transactions to be carried out through bank accounts or electronic payment methods, KosovaPress reports.

This measure is seen by economic experts as beneficial for increasing the formalization of the economy and fighting informality.

However, former director of the Tax Administration of Kosovo (TAK), Ilir Murtezi, says that citizens were not sufficiently and timely informed, which in his view reduces the effectiveness of the measure.

“This is a legal mechanism that gives the state power to fight or increase the formalization of the country’s economy. However, there was no public awareness campaign, and at the same time there was very late information after the issuance of this decision, which was dated April 27, while the announcement was made only 4–5 days ago, which in a way also reduces the seriousness of the state in this case to use this mechanism to increase formalization of the country’s economy. Many citizens are completely unaware of this rule or legal provision that obliges payments above 2,000 euros to be made through bank transactions or other payment methods that may be through the post or something similar... Nevertheless, I still believe this mechanism could have been used much better, to strengthen the use of this mechanism and at the same time effectively fight the phenomenon of informality, which is present in our country and economy,” he said.

On the other hand, tax expert Sakip Imeri said the decision requiring payments above €2,000 to be made through bank accounts is in line with current legislation.

Imeri said the measure will contribute to further formalizing the economy and reducing the use of cash in circulation.

The head of the “Consumer” association, Selatin Kaçaniku, welcomed the decision for payments above €2,000 to be made through bank accounts, saying it aims to direct as much financial turnover as possible into legal and transparent channels.

However, he said that those who abuse the system are often one step ahead of the law, so additional measures are needed to fight the informal economy.

“Every decision with good intentions, as the saying goes ‘with good intent’, is welcome and well received by me… This decision probably aims to ensure that as much financial turnover as possible is directed in a legal and fair way through bank accounts. However, those who are used to abusing this are always one step ahead of the law, one step ahead of us, one step ahead of the government, one step ahead of the law. And therefore, I also suggest some other forms without neglecting this one. The government, like all other legislatures, knows these matters better and knows how to justify itself better even when it gets it wrong or when it is late,” he said.

The Tax Administration of Kosovo (TAK) has not provided details to KosovaPress regarding the implementation of this decision.

However, on 25 May, TAK announced that cash payments above €2,000 between individuals are not allowed.

According to TAK, such payments must be carried out through the banking system or other electronic payment forms. It also urged compliance with the legally defined limit to avoid fines. “Do not pay cash above the allowed limit. Act according to the law,” the announcement states.