Monday, March 17 2014

The bill "On state support in IT sector" envisaging tax privileges for IT enterprises will cover start-up companies, not the incumbent ones, Karen Vardanyan, CEO of the Union of Information Technology Enterprises (UITE), said at today's press conference in Yerevan.     

He said that the IT sector in Armenia is developing slowly due to poor financing. Nevertheless, he added that the IT sector can increase its average annual growth from 22% to 30% even without any tangible investment.    

He stressed the need to conduct reforms in the education system, develop business in the IT sector and create a single state structure to protect the rights of innovation activities. "For the moment the innovation activity is under control of various ministries and each of them is hogging the cover", said Vardanyan. He recalled that all those proposals have been submitted to the Armenian Government 4 years before.   

Vazgen Safaryan, Head of the Union of Armenian Manufacturers, thinks that the bill will support the small business in the IT sector. He recalled that at the moment the share of the IT sector in Armenia's GDP is 2-3%. The bill will give an opportunity to considerably increase that share. In particular, the bill envisages creation of new 40-50 IT companies, which will employ 15-20 specialists each. "I think that the Government should provide tax privileges not only to the IT sector, but also to other sectors of small and medium business by increasing the annual VAT tax- exempt amount from 58.7 mln AMD to 100 mln AMD.  

Economist Vardan Bostanjyan, in turn, said, "In 2010-2011 the Armenian Government provided the IT sector with as much money as singer Nune Yesayan raises during each of her concerts - 80 mln AMD".  

To recall, the average monthly revenue of the IT sector in Armenia is 20 mln USD. 500 IT companies of Armenia employ 12 thsd specialists, with 10 thsd of them being engineers. 

To note, the UITE was founded in 2000. It unifies a number of companies to protect their economic interests, stimulate the IT sector, etc. The founders of the UITE are Migma, Algorithm, Link, ArmSoft, Arminco, and Sedit.