Wednesday, October 1 2014

 The representatives of the non-coalition factions of the Armenian Parliament met with Speaker of Armenian Parliament Galust Sahakyan to discuss the amendments to the Law on Turnover Tax.  

Aram Manukyan, MP from the Armenian National Congress (ANC) told journalists that they provided the Speaker with the facts that prove the unacceptability of the given amendments. "We have explained to the Speaker that the amendments to the Law may lead to serious political processes. Gyumri is already facing action protests and strikes, and small and medium business representatives have also gathered near the Parliament", he said. Manukyan added that the non-coalition forces reiterated their readiness to hold an extraordinary session on that issue. 

For his part, Vahram Baghdasaryan, Head of the ruling Republican Party of Armenia Faction, said that the representatives of the political forces should meet with the Government representatives and present all the facts and proposals. He added that after that they may come to an agreement.    

To note, on October 1 sellers in Gyumri joined their colleagues from Yerevan in protest against the new turnover tax.  Since Tuesday morning a group of sellers blocked the central streets and demanded that Prime Minister Hovik Abrahamyan visit the city.  "Unless he comes, we will go to Yerevan and join the local protesters," they said. For a few days already sellers in Yerevan have been protesting against the tax but some trade center owners have been trying to curb their protests. Particularly, the owner of Gold Market Trade Center Vagharsh Harutyunyan broke the booths of the jewelers who dared to join the campaign.

Armenian National Congress has expressed support for the protesters.  The party has urged the police to make responsible the owners that are threatening their protesting employees. Jointly with colleagues from prosperous Armenia and Heritage, the party's MPs are going to propose a tax that will not be too heavy for SMEs.

To remind, starting 1 October 2014, the turnover tax for economic entities engaged in the field of trade will be 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.