The share of taxes in GDP is within 30% in Armenia, RA Prime Minister Tigran Sargsyan said in an interview with RBK Daily.
“We have equal conditions for both domestic and foreign investors. This is a statutory requirement, which is of benefit to foreign capital. No restrictions on capital accounts or current transactions are in effect,” the Armenian Premier said.
As regards tax deferment, Tigran Sargsyan pointed out that, in the case of large-scale investment, VAT payments may be deferred – but not written off - for three years.
As regards the average tax rate for businesses, the Armenian Premier said: “We compare ourselves with our neighbors. Our tax rates are lower than the average rates. The macroeconomic indicators show that the share of taxes in the GDP is within 30%. In some countries it is 45 to 50 per cent. It is the tax potential rather than tax collection that is in question,” Sargsyan said. Speaking of off-shore economy problems, the Armenian Premier said that capital export restrictions and transaction record system were in effect in Russia for a long time. “In Armenia, we have not had such regimes since 1994. So there was no sense in foreign jurisdiction, and businesses were set up in Armenia. We viewed ourselves as kind of offshore, as a regional financial sector. Foreign capital is in control of over 50% of our financial sector,” he said.
The Armenian Premier said Armenia has two rivals in the region, namely Azerbaijan and Georgia. “The countries have similar economic doctrines, creating conditions for investors. We are monitoring economic, business activity and competitiveness monitoring. The Government approved an economic improvement program. Specifically, economic transparency requires monitoring of budget deficit, inflation and government intervention in the economy. We also study business communication with law-enforcement agencies and judicial practice. We have high ratings, but we always have work. Among our tasks is introducing e-signatures,” the Armenian Premier said.
Tigran Sargsyan also pointed out that Armenia launched reforms earlier than Georgia. “We passed a long way for years, whereas they ‘revolutionized’ their society. We are ahead of them in many aspects, but some reforms require more than one year. They are ahead of us in some aspects,” the Armenian Premier said.
