Finance Ministry seeks to set 20% revenue tax for microbusiness employees instead of fixed sum to counter exploitation

YEREVAN, OCTOBER 13, ARMENPRESS. The number of active micro-enterprise entities in the special tax system is higher than expected and the government seeks to amend the law to limit the tempting regulations through which businesses are attempting to be artificially eligible at all cost.

The current 5,000 dram revenue tax of contractors (hired employees) will be changed and calculated under general regulations – 20% rate starting next year.

“The salaries of all employees will be taxed under the general defined regulation,” the Head of the Department of Revenue Policy and Administration Methodology Ori Alaverdyan told ARMENPRESS.

In the past, when the government had set the 5,000 dram tax, it did not anticipate such high number of micro-enterprises. Today there are around 35-37 thousand micro-enterprise entities, compared to the anticipated 20-22 thousand.

Experience shows that some businesses are exploiting the regulation to pay fewer taxes.

The changes will take effect starting next year, if parliament adopts it.

The amendments are expected to bring an additional 5,5 billion in revenue taxes, and an additional up to 15,2 billion drams in terms of profit tax paying companies.

Anna Grigoryan