EVALUATING THE EFFECTS OF ELECTRONIC BILLING AND FISCALIZATION ON BUSINESS EFFICIENCY AND TAX COMPLIANCE: A STUDY OF ALBANIAN ENTERPRISES

Abstract

The evolution of business processes, particularly in billing and taxation, has seen a significant shift towards digitization through the adoption of electronic billing systems and fiscalization reforms. This study delves into the impact of electronic billing and fiscalization on business performance, with a specific
focus on Albanian enterprises, evaluating data from 2000 to 2023. The research investigates the benefits, challenges, and adoption factors of electronic invoicing, emphasizing its role in enhancing tax compliance, operational efficiency, and cost reduction. The study highlights how electronic billing streamlines invoice management, reduces administrative burdens, and contributes to environmental sustainability by minimizing paper usage. Despite these advantages, the transition poses challenges, especially for small and medium-sized enterprises (SMEs), due to high implementation costs, technical barriers, and limited awareness. A critical component of the research is the analysis of Albania's fiscalization reform, implemented in three phases starting in 2021, aiming to modernize the tax system, reduce informality, and align with European Union standards. The study assesses the fiscalization's effectiveness through
quantitative methods, including t-tests and regression analyses, evaluating variables like turnover, taxable profit, corporate tax, and net profit across sectors such as pharmaceuticals, construction, manufacturing, and wholesale trade. Findings reveal that while fiscalization has not significantly altered overall turnover or net profit, it has led to a notable decrease in taxable profit, particularly impacting SMEs due to higher compliance costs. Larger firms, with more robust digital infrastructures, absorbed these costs more effectively. The study concludes that while fiscalization improves transparency and tax compliance, it disproportionately burdens smaller businesses, necessitating targeted policy interventions to support SMEs in the transition towards comprehensive digital tax compliance.