Prime Minister of Armenia Hovik Abrahamyan has charged postponing inventory requirements for small business till 1 Feb 2015, the Government's press- service told ArmInfo.
The prime minister charged the finance minister to draft and submit to the government an appropriate bill within 3 days. The bill will be further submitted to the National Assembly for consideration. The inventory requirement was included in the new edition of the Law On Turnover Tax that came into effect on 1 October 2014. The requirements will be postponed till 1 Feb.
Discussions of the Law with public organizations representing small and medium-sized enterprises (SME) revealed a number of technical problems. The prime minister charged developing a suggestion on how to facilitate and optimize the inventory procedures within 20 days.
To remind, starting 1 October 2014, the turnover tax for economic entities engaged in the field of trade was reduced from 3.5% to 1%. A status of the family business will be introduced. The economic entities having up to 12 million drams annual turnover will be registered as family business and exempted from taxes. Starting 1 January 2015, the following types of responsibility will be applied to SME: a warning for violation of the law, a 20,000 AMD fine for repeated violation and a 5% turnover tax for a third case of violation. The economic entities violating the Law on Turnover Tax for the 4th time will occur in the field of VAT. Starting 1 Jan 2016, a SME having no document flow will have to pay the tax at a higher rate - 5%. VAT tax will be charged, if an economic entity fails to submit document flow for a second time. Alongside with this, a system "law-abiding taxpayer" will be introduced. The system implies that SME will get out of the shadow and start submitting the necessary documents to the taxation bodies. The responsibility for violation of the given law and mechanisms of control over administrative violations will be toughened as well. The bill sparked SME protests in the country.