Tuesday, April 23 2019 10:39

ArmInfo. The Armenian Parliament at its meeting on April 23 in the second and final reading amended the Law on State Assistance in the Field of Information  Technologies and the Tax Code of the Republic of Armenia.

According to the Minister of Transport, Communication and Information  Technologies of the Republic of Armenia Hakob Arshakyan, a number of  editorial changes were made to the package of legislative initiatives  by the second reading. In addition, following numerous discussions,  the provision on granting tax benefits to subsidiaries of foreign  companies was withdrawn. A new provision has been made regarding the  publication of financial activity reports. In particular, reports are  obliged to publish not only license companies, but also those that  have been refused in granting licenses. According to the minister,  the tax preferences system has been operating in the country since  2015 and exempts information technology companies from income tax  payments (a zero tax rate is in effect), and they also have a reduced  income tax of 10% instead of 23%.

Benefits will be valid until December 31, 2022, which will ensure a  unified approach and reduce the risk of tax evasion. Previously, the  system operated from 2015 to October 2018. Thanks to the privileges  provided, the number of startups in Armenia has increased  significantly: if in 2015 50 startups were registered, in 2016 their  number reached 100, in 2017 - 281 companies with licenses. At the  same time, there was an increase in the registration of new companies  in the field of high technologies. If in 2015 there were 288 of them,  then in 2016 there was some decline to 267, and in 2017 - 289  companies. Benefits are mainly provided for startups in addition to  software projects such as electronics, microelectronics, and graphic  games. The main task of tax preferences, as noted by Hakob Arshakyan,  is the creation of a product, not outsourcing, and the conquest of  the world by this product. He also noted that within the framework of  the program of development of the information technology sphere, the  volume of financing of scientific and technical activities aimed at  developing the IT sphere in the military-industrial complex will be  doubled. It is also planned to create various funds, first of all,  the Venture Fund, the creation of which with an authorized capital of  $ 100 million will be implemented in the next five years. The  government plans to commercialize intellectual property, as well as  create external sites. All these activities are envisaged to be  carried out as part of the overall program for the development of the  ecosystem.