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MEASURES TO BE TAKEN SOON ON IMPROVEMENT OF TAX LEGISLATION AND ADMINISTRATION IN SMALL BUSINESS
Noyan Tapan
April 18, 2008
YEREVAN, APRIL 18, NOYAN TAPAN. The amendments to the RA Law on
Simplified Tax took effect in Armenia on January 1st. Based on these
amendments, persons engaged in small business and those providing
some types of services, who previously paid simplified tax, shall
be taxed by general order. The deputy head of the State Tax Service
(STS) Armen Alaverdian said during the April 18 meeting with reporters
that as a result of the indicated amendments, in the first quarter
small businessmen encountered some difficulties related to taxes,
accounting, document circulation, and administration.
According to him, by instruction of the Armenian president, a
timetable of measures on solution of these problems was developed
and then approved by the prime minister. In particular, the STS is
responsible for their solution. By the order of the head of the STS,
all tax bodies were instructed to refrain from imposing administrative
liability on small businessmen - in case they submit reports later
than envisaged - and to assist small business in this issue. By the
same order, no stock-taking and checks of inventory holdings of the
representatives of small business shall be made. Checks shall be made
only in cases of obvious tax evasion.
In the opinion of A. Alaverdian, another important step is the
envisahed development of legislative amendments aimed at promoting
small business. It is envisaged establishing legislatively the
minimum level of annual turnover for small business. Those with a
turnover below this level will be considered small businessmen in
terms of taxation, with numerous mild requirements being envisaged
for them. In particular, the number of reports to be submitted will
be reduced, the accounting tasks and the taxation procedures will be
simplified. Studies of experience of 30 countries like Armenia showed
that the minimum level of annual turnover is fixed at 20-120 thousand
USD in these countries.
A. Alaverdian said that previously it was inexpedient to use
simplified tax as, according to statistics, in 2007 there were about
32 thousand economic entities - simplified tax payers, whose average
annual turnover made only 17 mln drams. However, in his words, state
budgetary revenues grew only 3-3.5fold in case of the 16fold increase
in the number of these entities.
The STS deputy head said that this growth tendency might pose serious
danger in terms of the state budget's execution. It was announced
that about 16-17 thousand companies - simplified tax payers operated
in Armenia in March.
Noyan Tapan
April 18, 2008
YEREVAN, APRIL 18, NOYAN TAPAN. The amendments to the RA Law on
Simplified Tax took effect in Armenia on January 1st. Based on these
amendments, persons engaged in small business and those providing
some types of services, who previously paid simplified tax, shall
be taxed by general order. The deputy head of the State Tax Service
(STS) Armen Alaverdian said during the April 18 meeting with reporters
that as a result of the indicated amendments, in the first quarter
small businessmen encountered some difficulties related to taxes,
accounting, document circulation, and administration.
According to him, by instruction of the Armenian president, a
timetable of measures on solution of these problems was developed
and then approved by the prime minister. In particular, the STS is
responsible for their solution. By the order of the head of the STS,
all tax bodies were instructed to refrain from imposing administrative
liability on small businessmen - in case they submit reports later
than envisaged - and to assist small business in this issue. By the
same order, no stock-taking and checks of inventory holdings of the
representatives of small business shall be made. Checks shall be made
only in cases of obvious tax evasion.
In the opinion of A. Alaverdian, another important step is the
envisahed development of legislative amendments aimed at promoting
small business. It is envisaged establishing legislatively the
minimum level of annual turnover for small business. Those with a
turnover below this level will be considered small businessmen in
terms of taxation, with numerous mild requirements being envisaged
for them. In particular, the number of reports to be submitted will
be reduced, the accounting tasks and the taxation procedures will be
simplified. Studies of experience of 30 countries like Armenia showed
that the minimum level of annual turnover is fixed at 20-120 thousand
USD in these countries.
A. Alaverdian said that previously it was inexpedient to use
simplified tax as, according to statistics, in 2007 there were about
32 thousand economic entities - simplified tax payers, whose average
annual turnover made only 17 mln drams. However, in his words, state
budgetary revenues grew only 3-3.5fold in case of the 16fold increase
in the number of these entities.
The STS deputy head said that this growth tendency might pose serious
danger in terms of the state budget's execution. It was announced
that about 16-17 thousand companies - simplified tax payers operated
in Armenia in March.