It’s too early to change the procedure for calculation of property taxes in this phase. This is what economist and founder of the Banking Management School (BMS) Ashot Osipyan said today.
According to him, the goal of making property tax reforms is to increase the property tax ratio from 0.2% to 2%, but this shouldn’t be an end in itself since the level of incomes of the population must be taken into consideration. “Armenia shouldn’t compare itself with Kazakhstan, which has such a tax system, and even with Georgia. We need to find our own path for development,” he said.
Alongside this, the ratio of property tax to the GDP can be increased not only through expansion of the calculated tax base, but also increase of the volume of property. Osipyan agreed that there is a need to review the real estate tax, but not now. “During the pandemic, countries avoid making reforms in taxation, and they are currently focused on boosting the economy through financial investments,” he said.
Osipyan emphasized that there are already negative expectations in the real estate market and that the property tax reforms will only increase the negative expectations. Moreover, the reforms will have a negative impact on the construction sector.