Armenian Parliament passed amendments to Law on VAT in first reading on December 15.
Deputy Minister of Economy Garegin Melkonyan says the Bill looks to create Duty Free zones at land frontiers in Armenia, particularly in Meghri (border with Iran) and Bagratashen (border with Georgia). No VAT will be charged in the given zones and it will help promote the trade and economic relations with the neighbor states. He said there is one such zone in Armenia but it is not exempted of VAT unlike the Duty Free zones at airports.
Only one company, Duty Free Alliance is engaged in the field on the border with Iran. Yet in June 2011, the government allowed leasing 800sq m area at the Customs Point in Meghri for 49 years and the leasing payment is equal to the cadastral values. If the Bill is passed, the company pledges to invest in the development of the area up to 1 million EUR. He said such Duty Free zone operates in Georgia on the border with Armenia. Melkonyan said the Bill will not affect the state budget revenues.