ArmInfo. On November 28, Armenian President Serzh Sargsyan signed the law "On the exemption from VAT of imports of exclusively defense products for the Armed Forces of the Republic of Armenia within the framework of interstate (intergovernmental) agreements signed between the Republic of Armenia and other countries." This was reported by the press service of the RA President.
The National Assembly of Armenia at the meeting on November 17 approved in the second and final reading the bill "On the exemption from VAT of imports of products exclusively for defense purposes within the framework of interstate agreements." Presenting the bill, the Minister of Finance of the Republic Vardan Aramyan recalled that the agreement was formerly called "On the exemption from VAT of imports of products exclusively for defense purposes within the framework of interstate agreements between the Republic of Armenia and the Russian Federation." "At present, we import military equipment and weapons mainly from Russia, the bill exempted from VAT the supply of weapons only from this country. However, we do not rule out the possibility that in the future Armenia will supply weapons from other countries, and in connection with that they suggested removing the geographical limitation from the draft laws, "Aramyan said. The minister noted that the government considers it inexpedient to tax the VAT of this type of product, since it will not have the possibility of selling both on the domestic market and subsequent exports to third countries.
"In fact, we get rid of unnecessary actions in the budget, since the tax paid for supplies, according to the law on VAT refund, was still deducted from the budget," Aramyan said. On November 16, the Government of Armenia approved the draft law on ratification of the "Agreement between the Government of the Republic of Armenia and the Government of the Russian Federation on granting the government of the Republic of Armenia a state export credit", and it was considered urgent to ratify it. The legislative initiative will be submitted to the National Assembly of Armenia in the prescribed manner.
According to the draft agreement, Russia will provide the Armenian side with a state export credit of $ 100mln. to finance the supply of military products of Russian production. The Armenian side uses the loan to finance up to 90% of the cost of each contract for the supply of products calculated in dollars. Prepayment will be at least 10% of the contract value and be implemented by the Armenian side in favor of authorized Russian organizations. The draft agreement states that the loan is issued with a maturity of 15 years at 3% per annum. Repayment of the principal amount of the loan is scheduled to begin on May 15, 2023 and be completed on May 15, 2037. In the first six years, Armenia will annually repay a loan of $ 1.5 million, after which the amount of allocations will increase to $ 3.6- $ 3.8 million. Armenia should use credit funds in 2018-2022. Based on the loan agreement, separate agreements will be concluded between the Armenian Ministry of Defense and Rosoboronexport OJSC on the order and timing of deliveries of arms and military equipment.
Early, Moscow has already provided Armenia with a loan of $ 200 million for a period of 10 years. Yerevan uses these means to purchase launchers of the Smerch multiple rocket launcher and its ammunition, the Igla-S missile system and its missiles, the Avtobaz-M ground reconnaissance systems, the TOS-1A heavy flamethrower systems Solntsepek "with transport-loading machines TZM-T, guided missiles 9M113M, RPG-26 grenade launchers, B-429E fuses, Dragunov sniper rifles (SVD), armored vehicles, Tiger armored vehicles, engineering equipment and communications equipment. In addition, Russia supplied Armenia with the Iskander missile system. According to the intermediate program of expenditure for 2018-2020. Armenia plans to increase military spending by $ 60 million annually. The aim of Yerevan is to increase the level of military spending by 4% of GDP. At present, Armenia's military expenditures amount to about 3.6% of GDP - about $ 450 million