YEREVAN. – Armenia should have maintained the Soviet industry, and not chased after the taxes of the small and medium-sized enterprises (SMEs).

Economist Vazgen Safaryan, who is Head of the Union of Domestic Goods Producers of Armenia and also Chairman of the United Progressive Communist Party of Armenia, stated the aforesaid at a press conference on Saturday.

In his words, had this been the case, there would have been no need to think how to provide jobs in Armenia to tens of thousands of people who today make a living by trade.

“It’s no secret to anyone that 60 to 70 thousand people, who are engaged in the SMEs, provide for the 2 to 2.5 percent of the tax revenues of the [country’s] budget. It means the preservation of the SMEs is a social matter, first and foremost, and the government needs to allow this domain to ‘breathe’ freely.”

“Whoever wants, let him work with the old way [i.e., 3.5-percent turnover tax and exemption from documentation], and whoever prefers to work with a 1-percent interest rate and strict documentation, let him work like that in order to preserve these jobs,” Safaryan stressed, in particular.

As reported earlier, pursuant to the amendments to the Law on Turnover Tax, which has come into force in Armenia on October 1, 2014, the tax rate for businesses in the country has dropped from 3.5 percent to one percent. But, now, the businesses will have to submit documents on their commodity circulation. And if a business enterprise does not submit a respective document, it will be warned at first, and, subsequently, it will be fined.

The amendments have caused a considerable protest among the country’s small and medium-sized merchants. In their view, asking for these documents from the large businesses is unrealistic because the large businesses often do not provide documents to the small and medium-sized enterprises concerning the products.

The government, on the other hand, justifies these amendments with the need to prevent tax evasion by Armenia’s large businesses.

As a result of protests as well as talks with Armenia’s public sector, however, the government drew attention to the fact that the small businesses lack—for the moment—the proficiency for making an inventory of their goods and products and filling out the respective complicated questionnaires, and therefore decided to extend the aforementioned deadline for four months, until Sunday, February 1, 2015.