ArmInfo. The Republican Union of Employers of Armenia (RUEA) believes that if the State Revenue Committee (SRC) is truly concerned about the problem of tax collection and increasing tax discipline, it should simply abandon the initiative to abolish incentive norms and establish stricter criminal liability for tax violations, since its adoption, in addition to other destructive consequences for the country's economy, will directly aggravate the problem of tax evasion.
Earlier, ArmInfo reported that the State Revenue Committee decided to abandon incentive norms, stating that they contribute to the commission of tax crimes, and the legal grounds for recognizing exemption from criminal liability by compensating for property damage caused by a crime hinder and do not provide an opportunity to prevent the commission of new tax crimes. The initiator proposed to establish punishment for tax offenses in the form of imprisonment for a term of 3 years or more, in the event of violations in the amount of 10 million drams or more. The bill was met with extreme negative reactions by the business community and expert circles. But the head of the State Revenue Committee Rustam Badasyan retorted, stating that due to the presence of this article (Part 5 of Article 290 of the Criminal Code of the Republic of Armenia - ed.), the competitive environment in the republic has been undermined.
"The Republican Union of Employers of Armenia (RUEA) fully supports legislative initiatives aimed at increasing tax discipline and preventing tax crimes (which the SRC is trying to the need to adopt the presented project with), but is deeply convinced that the adoption of this project will not only fail to contribute to the implementation of the goal set by the SRC, but will simply have a destructive impact on both ensuring the continuity of ongoing economic activity and on decision-making on the implementation of new business initiatives in the Republic of Armenia>, - the statement said. In particular, as the members of the Union believe, the introduction of such a legislative initiative gives serious grounds to believe that the ultimate goal of the SRC is to bring people to criminal liability, and not to ensure the payment of taxes. in the form of imprisonment for the offense committed for some reason," they noted.
At the same time, if a person is brought to criminal liability, the State Revenue Committee will have to apply additional administrative efforts and spend resources to ensure the fulfillment of unpaid tax obligations, since, as already mentioned, no person will voluntarily pay tax amounts if he or she is also subject to criminal liability. Meanwhile, it is high time for the State Revenue Committee to realize that not causing harm to business in tax administration should be considered a priority, and in the case of tax offenses, punitive instruments should be used only when all possibilities for ensuring the fulfillment of tax obligations by administrative and legal methods have been exhausted. At the same time, the Union recalled that tax discipline largely depends on the level of tax literacy of both specialized specialists of business entities (accountants, tax officers, etc.) and tax employees. In this context, it is necessary to take into account the complexity of tax legislation, the frequency of its changes, professional nuances of the application of legislative norms, the peculiarities of the application of international tax legal norms, which does not guarantee error-free work even for the vast majority of specialists.
In addition, in many cases, the that serve as the basis for initiating criminal cases are often far from reflecting the real situation. It is also not uncommon for tax officials to not dare to significantly deviate from the provided by the auditor during tax audits appointed by the auditor on the basis of . , - ask the members of the Union.
The RUEA also warns of threats to the investment attractiveness of the Republic of Armenia as a whole. Moreover, there will be an outflow of capital from the Republic of Armenia. , the experts noted. In addition, as they believe, there is no doubt about the presence of serious corruption risks when adopting the project. In particular, in order not to exceed the threshold of criminal liability (10 or 20 million drams) or to avoid criminal liability altogether, a taxpayer who has committed a tax offense under any circumstances will try to negotiate with the tax authority. The latter, threatening criminal liability, will simply dictate their terms when reaching an agreement with the taxpayer.
The RUEA is perplexed; in recent years, the State Revenue Committee has repeatedly reported on increasing the level of tax discipline. So, what is the real goal of the initiative in this specific period of time?, they ask. Unlike previous years, during 2024, the State Revenue Committee does not report exceeding the approved tax revenue targets. At the same time, according to official information, tax revenues for the first half of 2024 were collected less than planned by approximately 117 billion drams. If these trends continue, the annual shortfall may reach about 230 billion drams, which is almost 10% of the annual tax revenues approved by the budget. Of course, it is important for the state that the government has sufficient financial resources to fulfill budget expenditures. But this does not mean at all that the issue of bringing businessmen to full criminal liability should be considered as a way to correct the current situation; the reasons for this should be sought elsewhere, especially since such a solution to the issue will have the opposite effect: tax arrears will increase," the experts noted.
A study of international experience also documents that the overwhelming majority of countries prefer to use incentive standards, the Russian Union of Taxpayers (RUTA) stated. In particular, similar incentive standards are also used in the EAEU member states, neighboring Georgia.
, they noted.
Thus, having studied the experience of 47 member countries of the Organization for Economic Cooperation and Development (OECD), the Union states that yes, all OECD member countries apply criminal prosecution for tax offenses. However, even in these countries, which, compared with non-OECD countries, support the use of more stringent criminal instruments for tax offences, a number of rules based on the priority of tax payment are applied.
In this vein, the Union is convinced that before introducing such a legislative initiative, the State Revenue Committee should have analyzed the realities that have developed over the past few years in order to find out whether tax officials are acting within the legal framework when implementing their control functions. , - they noted.
The experts are also concerned about the part of the initiative that concerns the criminalization of smuggling. The initiator proposes to establish punishment for this criminal act in the form of imprisonment for a term of 3 to 6 years.
Based on the above, the RSRA once again calls on the State Revenue Committee to refrain from the presented project.
It should be noted that the corresponding legislative initiative was posted on the single portal of legal acts on August 8 and by the end of August 23 (during this period it was possible to vote and make proposals) 100% of respondents spoke out against the project.
