YEREVAN. – The Government of Armenia has approved the bill on making amendments to the Law on Turnover Tax. Finance Minister Gagik Khachatryan stated, at Thursday’s Cabinet meeting, that the deadline for the inventory of the goods and products, which the country’s small and medium-sized businesses have purchased, is extended from October 1, 2014 to February 1, 2015.

Pursuant to the amendments to the Law on Turnover Tax, which has come into force in Armenia on October 1, 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 talks with Armenia’s public sector, however, the government drew attention to the fact that the small businesses lack 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.