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Official News

Tuesday, 23 September 2014

Prime Minister Receives Trade Fair-Engaged Entrepreneurs

Prime Minister Hovik Abrahamyan received trade fair-engaged entrepreneurs who have been staging a protest action in front of the government building.

The SME representatives thanked the Premier for reception and consideration of their concerns regarding the amendments to the law on turnover tax, due to come into force on October 1, 2014.

The amendments imply reduction in turnover tax for small and medium-sized businesses from 3.5 percent to 1 percent. At the same time, the affected companies will have to produce duly drafted documentation to tax authorities.

Taking note of the protesters’ arguments and observations, Hovik Abrahamyan reassured that the bill seeks to bring large taxpayers into the legal field, while small and medium-sized businesses will not suffer from the application of new law in any way. He said the government’s goal is prevent SMEs from serving as a tax fraud tool for major businesses.

The Prime Minister stressed that small and medium-sized enterprises will be subject to audits only in case of specific risks, with large taxpayers to be the main focus of tax authorities.

At the same time, Hovik Abrahamyan said the government does not consider SMEs as taxpayers; on the contrary, the law shall lead to AMD10 billion less revenue in the State budget due to the fact that the SMEs will be paying 1% turnover tax instead of the currently applicable 3.5 percent.

“The government deliberately abandoned that portion of budget receipts in order to boost small and medium businesses. That was our goal. Please do not work without proper documentation as the government has eased your tax burden to let you thrive and grow,” the Prime Minister noted.

Concerning the allegation that large businesses refuse to provide any relevant documentation, Hovik Abrahamyan said there are competent authorities, supposed to track and prosecute the offenders. The Prime Minister went on to remind that the government had passed the decision following substantiated discussions held with all the stakeholders within the Prime Minister-affiliated SME development council.

“You should help us bring major businesses into the field of taxation. This is our goal. We are far from being your enemy: on the contrary, we are doing everything to make you get even stronger. Small and medium-sized entrepreneurship is important to us. This is why we are proceeding this way,” Hovik Abrahamyan concluded.

The parties agreed that the SME representatives should submit their proposals to Deputy Finance Minister Armen Alaverdyan in writing.

December 2021