Tuesday, January 11 2022 19:36
Naira Badalian

Issue of introducing universal income declaration system for  individuals was discussed at meeting chaired by Nikol Pashinyan 

Issue of introducing universal income declaration system for  individuals was discussed at meeting chaired by Nikol Pashinyan 

ArmInfo.On January 11, Armenian Prime Minister Nikol Pashinyan chaired a meeting on the introduction of a universal income declaration system for individuals.

According to the press service of the Prime Minister, Pashinyan  recalled that the issue of introducing a system for universal  declaration of income of individuals in the Republic of Armenia is  included in the government's action plan for 2021-2026. He said, that  the government strongly supports the implementation of this system.  According to him, the Cabinet attaches particular importance to the  introduction of both this system and universal health insurance. "We  have come to the conclusion that a universal declaration system is  necessary in order for us to have an effective and fair health  insurance system," he said.  Finance Minister Tigran Khachatryan  presented a general description of the proposed system and a  comparative analysis of the current declaration system.

Other issues related to goals, requirements, efficiency, cost  incentive mechanisms, diversification of income tax refunds were also  discussed at the meeting. They also touched upon the upcoming steps  to introduce a universal system for declaring the income of  individuals.  At the end of the crisis year 2020, the actual tax  collections of the state treasury amounted to 1.385 trillion drams -  about 217 billion drams less than 1.602 trillion in the state budget. 

As a result, on New Year's Eve - December 30, the Armenian government  approved the decision "On approval of measures aimed at narrowing the  gap in tax policy", within the framework of which the Ministry of  Economy was entrusted to develop the Concept of the Republic's  economic policy, aimed mainly at reforms in the field of taxation.   In June 2021, with reference to the abovementioned Concept, ArmInfo  reported that the Armenian government proposes to start compulsory  declaration of income of individuals from January 1, 2022. 

As stated in the Concept, at the initial stage, persons who have  received income exceeding AMD 12 million per year are subject to  mandatory declaration. It was noted that from 2023, citizens with an  income of more than 6 million drams will have to declare income, and  from 2024 - 2 million drams. For persons with lower incomes, a  voluntary regime will be established if taxable wages (up to 2  million AMD) are recognized as the only source of income.  The  authors of the document assured that the process will be activated  subject to a number of conditions.  First of all, in order to  stimulate the declaration process, a system of social contributions  will be introduced in parallel (in total, they should not exceed X%  of income - in the range of 20-50% of income). The so- called credit  points will be awarded based on the economic priorities of the state.  For example, for the amount paid for child care services (up to 10  years old).  According to the plan, these credit scores will assist  the process of bringing nannies and private kindergartens out of the  shadow. Points will also be earned for the actual, documented costs  of commuting to work by public transport. This measure, according to  the authors of the document, will lead to a reduction in the "shadow  turnover" in the sale of tickets in public transport.  

In addition, the Ministry of Economy proposed the accrual of credit  points for voluntary pension contributions above the established  threshold of 5% - in the amount of 20%, which will contribute to the  development of the financial market, for interest payments on  mortgage loans (for apartments and houses outside Yerevan, and in  Yerevan - for real estate, the construction of which was carried out  on the site of emergency housing), as well as for energy-saving  apartment renovation. Certain "bonus" points were also promised to be  awarded for technical (STEM), agricultural and natural sciences  education, as well as for charity.


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