ArmInfo.Compared to 2017, the state budget of Armenia in 2024 will be doubled, as stated by Rustam Badasyan, the Chairman of the State Revenue Committee of Armenia, on November 4 during parliamentary hearings on the draft state budget for the country in 2024.
He noted that 90% of all incoming taxes are provided by large businesses, therefore, accusations against the department about pressure on small and medium-sized businesses are not true. Badasyan emphasized that all tax administrations are focused on large businesses, which often use special taxation systems to reduce tax deductions. This is often part of a planned policy, but there are also instances of aggressive policy.
Meanwhile, Badasyan continued, the state aims to create the best conditions for businesses. The head of the State Revenue Committee disagreed with the opinion that Armenia lacks a real economy, emphasizing the importance of the construction sector. He questioned whether this sector is part of the real economy or not. The State Revenue Committee intends to generate an additional 142 billion drams from the construction sector by 2025-2026. The new legislation will require construction companies to calculate and pay VAT upon receiving income from apartment sales, rather than waiting until construction is completed and the building is registered in the cadastre. Currently, apartments are typically sold much earlier.
Thus, developers have an additional period of 1-2 years between receiving income and paying taxes. Despite the growth in construction turnover in Armenia (13.2% in 2023), the VAT collected from it is negative: (- 23.3 billion drams in 2023), because companies can offset VAT when purchasing construction materials, and only pay it on sales after some time. However, with the new innovation, the deferred tax will eventually need to be paid. According to the State Revenue Committee, developers will have to pay 142 billion drams in 2025-2026. The State Revenue Committee will not only focus on collecting net taxes from the construction sector, but also refund citizens income tax on mortgages in the amount of 84 billion drams next year. Since the beginning of 2024, this figure has already reached 67 billion drams.
