Albanian government has announced that it plans to implement flat tax scheme to improve business climate and attract foreign investment, local media reported of Friday.

"From January 1, 2008, Albania will have implemented the 10 percent flat tax system, one of the lowest in Europe," Albania's Prime Minister Sali Berisha was quoted as saying.

Under the plan, the current corporate tax of 20 percent will be slashed in half to 10 percent. Supporters say the reform would widen the taxable base and simplify tax administration.

But critics say it will mainly benefit businesses and the rich, and the poor will suffer the most with the abolition of the progressive tax system.

Source: Xinhua