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YEREVAN. – The Armenian parliament passed in the first reading the amendments to the Law on Turnover Tax for small and medium-sized business with 92 votes “for” , six  votes “against”, and 13 abstentions.

Orinats Yerkir abstained from voting, while the Armenian National Congress and Heritage opposed the bill.

As reported earlier, pursuant to the initial amendments to the Law on Turnover Tax, which have 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.

But these initial 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 initial 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 had decided to extend the aforementioned deadline for four months, until February 1. And during the special Cabinet meeting on January 31, it was decided to make new amendments and postpone for five more months, until July 1, the aforesaid law’s controversial requirement of product documentation, and the NA has passed the respective bill.

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