Tuesday, February 12 2019 14:22

ArmInfo. High income earners  benefit from the introduction of a flat income tax scale. This was  stated by the Minister of Finance of the Republic of Northern  Macedonia Dragan Tevdovski on February 12 in an interview with  journalists on the margins of an international conference called "The  Tax System, Justice and Economic Development."

According to the Minister, the Republic of Northern Macedonia in 2007  introduced a flat scale of income taxation. At the same time, many  countries in Eastern-Western Europe have switched from progressive to  flat personal income taxation. After only one decade, many countries  - the Czech Republic, Slovakia, Montenegro, began to return to a  progressive scale, Georgia and Bosnia Herzegovina are already  thinking about it.

The introduction of a flat scale, as indicated by the head of the  financial department, led to a greater gap in the incomes of  citizens. It also became apparent that after the transition, state  budget revenues were reduced and GDP fell. "Our revenues have become  the lowest in the region, and a return to the previous system will  provide large revenues to the state treasury, which will allow us to  increase spending on education, health care, and social programs," he  said.

Based on the experience of his country, today the Minister of Finance  of the Republic of Northern Macedonia responsibly declares that as a  result of the application of a flat income tax scale, in general, tax  procedures are simplified. Nevertheless, according to him, this  system is favorable to those with a high level of income. Dragan  Tevdovski notes that Armenia and the Republic of Northern Macedonia  are similar in many respects, in particular, nominal GDP is almost  identical. However, when asked by ArmInfo whether the head of the  Finance Ministry of a European state is going to recommend the  Armenian colleagues to refrain from introducing a flat income tax  scale in Armenia, taking into account the "bitter" experience of his  country, Tevdovski said: "We are going to share our experience,  including present both negative and positive aspects of this system.  Already the Armenian government has to decide which system to give  preference to. "

To note, currently the following scale of taxation is in force in  Armenia: those who receive a monthly income of up to 150 thousand  drams pay 23%, from 150 thousand to 2 million drams - 28%, and more  than 2 million drams - 36%. The draft amendment "On Amendments and  Additions to the Tax Code of the Republic of Armenia", developed by  the Ministry of Finance of Armenia and submitted to the public,  provides for a transition to a flat income taxation system, which,  regardless of salary, will be set at 23%.  Transition is scheduled  from September 1, 2019. According to official data, the lion's share  of hired workers - 64.9% receive a salary of up to 150 thousand drams  (about 610 thousand), 34.8% receive a salary of up to 2 million  drams, and employees with a salary higher than 2 million drams amount  to 0.3 %