New tax law fueling businessmen's uproar in Armenia

/By AzerNews/

By Mushvig Mehdiyev

A group of small and medium business owners in Armenia, including market traders held a rally again in front of the government office in Yerevan calling for an immediate answer to their demands, on January 29.

The businessmen threatened to go on further protest marches unless the planned controversial amendments to the sales tax law is withdrawn.

The desperate traders said they wanted to continue their business activity based on the current rules, as the new law imposes an extra burden on them contrary to the government's claim that it is beneficial for small and medium businesses.

Despite the fact that the new law provides a reduction of sales taxes for trader to 1 percent from 3.5 percent, its stricter rules for the submission of sales-related documentation to tax authorities inflict serious blows on small and medium businesses.

The law should have came into force earlier on November 1, 2014, but, following a series of protest rallies by small and medium business owners along with hundreds of workers of Yerevan fairs, the government sat back and postponed the activation of law until February 1, 2015.

The protesters also claimed that the new law may well serve the government's plan to use the small companies as a tool in fight against tax evasions by larger companies, which is an unprecedented violation of rights.

Even the traders from the provinces, including Gyumri, flocked to the capital city to join the protests calling for Finance Minister Gagik Khachatryan’s resignation. They marched towards the presidential palace in central Yerevan and closed the Bagramyan avenue where the president's residence locates, according to News.am, a local media outlet.

The demonstrators threatened a nationwide strike against the government, saying they will stop paying taxes from February.

"If they do not listen to us with their ears, they will have to listen to us with their pockets," one of the protesters said.

Vilen Khachatryan, an economist, said the small and medium businesses should not be pitted against the large companies in an effort to suppress tax evasion by the latter.

"Here again the small companies will suffer the most, since the larger businesses in Armenia have more power to put pressure on them,” he added.

Back in January 26, some 500 market employees gathered in front of the government building in Yerevan to express their unanimous concern over the new law to the government. Even though they called on the prime minister to emerge before the crowd and lively respond to their complaints, no one from the ruling cabinet did walk up to the protesters.