Azernews.Az

By Rashid Shirinov

The Armenian Parliament approved the draft Tax Code after its third and final reading at a meeting on October 4. A total of 78 MPs voted in its favor, while 19 members were against, RIA Novosti states.

Prior to the voting, the opposition parliamentary factions of the parties ‘Heritage’, ‘Prosperous Armenia’, ‘Armenian Renaissance’ and the Armenian National Congress expressed disagreement with the new code.

Before the vote, MP Edmon Marukyan stated that 90 percent of the deputies’ proposals were not taken into account in the new project.

"In a year and a half, Armenia will not be able to meet its loan obligations; this Code does not solve the problem – on the contrary, problems will arise," Marukyan said.

The new Tax Code envisages reduction of the average rate of income tax, abolishment of the tax on profits from dividends that will be reinvested in a company.

Moreover, the state fee on casino will increase in 2.5 times – from 190 million drams ($400,000) to 500 million drams ($1,052 million) per year. This will cover the reduction in Armenia’s revenue caused by tax cuts.

The VAT threshold will be returned to 58.35 million drams ($123,000) per year from current 115 million drams ($240,000).

Armenia’s external debt is growing, as well as the budget deficit; economic growth is significantly lower than it was foreseen.

As a result of Armenian government’s policy, next year’s budget expenditures of the country have been reduced by 100 billion drams ($211 million). At the same time, external donors – international financial institutions put stringent condition to Yerevan, which demands the increase in tax collections by 60-70 billion drams ($13-15 million) annually.

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Rashid Shirinov is AzerNews’ staff journalist, follow him on Twitter: @RashidShirinov

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