YEREVAN, JANUARY 4, ARMENPRESS. Income tax rate dropped from 22% to 21% starting January 1, while the rate of pension payments increased 1% and is now 4,5%.

Armenia passed a law in 2019 adopting flat income tax rates and the rate was decreasing 1% every year. It will eventually stand at 20% in 2023.

The pension payment is a mandatory payment taxed from employed citizens born after 1974 January 1 guaranteeing retirement pension. Citizens born after 1974 are entitled to join the pension plan voluntarily.

The pension tax, aka social payment, was at a rate of 2,5% in 2020 for citizens whose salary was below 500,000 drams, and another 7,5% was paid by the government. Since 2021, the rate became 3,5% and 6,5% respectively, and from 2022 it was changed to 4,5% and 5,5%.