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Armenia's Parliament Passes Profit Tax Amendment: Opposition Argues
Country Being Turned Into Offshore Haven
Grisha Balasanyan
21:28, September 10, 2013
Today, by a vote of 67 to 42 a draft bill to make amendments to
Armenia's Law on Profit Tax was approved by the National Assembly.
The bill passed on the second hearing.
It was Deputy Finance Minister Souren Karanyan who took the podium in
the parliament and spoke out in favor of the bill that would free non
residents from paying profit tax in a number of instances.
Non residents would be exempt from the tax on interest accrued from
government foreign currency bonds or from the sale of such bonds, from
the exchange of other securities, and from the revenues accrued from
similar transactions.
For legal purposes organizations established in foreign countries are
considered non-resident, as well as international organizations and
any subsequent organizations they establish outside Armenia.
Deputy Minister Karanyan stated that resident organizations of other
countries with which Armenia has signed a double taxation treaty will
not be doubly taxed. Those organizations, resident in countries with
which Armenia has no double taxation treaty, will be doubly taxed when
investing in foreign currency bonds issued by Armenia.
Karanyan argus that the latter case decreases interest in investing in Armenia.
ARF MP Artzvik Minasyan noted that non-registry is mostly dependent
not on a person's citizenship but on the center of their activity or
economic interest.
Minasyan asked the official what guarantees were there that Armenian
capital wouldn't be sent abroad, say to an offshore company, and then
come back to Armenia, to be invested in Armenian-issues securities and
not get taxed?
Deputy Minister Minasyan retorted that he didn't find it realistic
that Armenian companies would go offshore to register and then evade
being taxed as non-resident companies.
Minasyan argued that one of the reasons is that an Armenian company
can amass a greater profit domestically, rather than by operating as a
non-resident operation.
Armenian National Congress (HAK) MP Hrand Bagratyan took the floor and
declared that he was categorically opposed to the bill, arguing that
by giving allowances to the wealthy, the country would be turned into
an off-shore zone.
`Are you creating an off-shore zone, or is it just because you like
the word offshore,' chided Bagratyan.
Those voting against the bill were the parliamentary opposition and
the Prosperous Armenia Party.
Voting in favor of the bill, besides ruling coalition member the
Republican Party and Rule of Law, was independent MPs Khachatur
Kokobelyan,
Those abstaining were Edmon Maroukyan, Levon Zurabyan, Stepan Demirtchyan.
http://hetq.am/eng/news/29240/armenias-parliament-passes-profit-tax-amendment-opposition-argues-country-being-turned-into-offshore-haven.html
Country Being Turned Into Offshore Haven
Grisha Balasanyan
21:28, September 10, 2013
Today, by a vote of 67 to 42 a draft bill to make amendments to
Armenia's Law on Profit Tax was approved by the National Assembly.
The bill passed on the second hearing.
It was Deputy Finance Minister Souren Karanyan who took the podium in
the parliament and spoke out in favor of the bill that would free non
residents from paying profit tax in a number of instances.
Non residents would be exempt from the tax on interest accrued from
government foreign currency bonds or from the sale of such bonds, from
the exchange of other securities, and from the revenues accrued from
similar transactions.
For legal purposes organizations established in foreign countries are
considered non-resident, as well as international organizations and
any subsequent organizations they establish outside Armenia.
Deputy Minister Karanyan stated that resident organizations of other
countries with which Armenia has signed a double taxation treaty will
not be doubly taxed. Those organizations, resident in countries with
which Armenia has no double taxation treaty, will be doubly taxed when
investing in foreign currency bonds issued by Armenia.
Karanyan argus that the latter case decreases interest in investing in Armenia.
ARF MP Artzvik Minasyan noted that non-registry is mostly dependent
not on a person's citizenship but on the center of their activity or
economic interest.
Minasyan asked the official what guarantees were there that Armenian
capital wouldn't be sent abroad, say to an offshore company, and then
come back to Armenia, to be invested in Armenian-issues securities and
not get taxed?
Deputy Minister Minasyan retorted that he didn't find it realistic
that Armenian companies would go offshore to register and then evade
being taxed as non-resident companies.
Minasyan argued that one of the reasons is that an Armenian company
can amass a greater profit domestically, rather than by operating as a
non-resident operation.
Armenian National Congress (HAK) MP Hrand Bagratyan took the floor and
declared that he was categorically opposed to the bill, arguing that
by giving allowances to the wealthy, the country would be turned into
an off-shore zone.
`Are you creating an off-shore zone, or is it just because you like
the word offshore,' chided Bagratyan.
Those voting against the bill were the parliamentary opposition and
the Prosperous Armenia Party.
Voting in favor of the bill, besides ruling coalition member the
Republican Party and Rule of Law, was independent MPs Khachatur
Kokobelyan,
Those abstaining were Edmon Maroukyan, Levon Zurabyan, Stepan Demirtchyan.
http://hetq.am/eng/news/29240/armenias-parliament-passes-profit-tax-amendment-opposition-argues-country-being-turned-into-offshore-haven.html