YEREVAN. – The National Assembly (NA) of Armenia on Thursday passed, at its second hearing and in full, the bill on making new amendments to the Law on Turnover Tax.

The draft law passed by a vote of 75 for and 19 abstentions, and no MP voted against this proposed law.

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 now the NA has passed the respective bill.