ArmInfo. The Armenian Ministry of Finance believes that the problems in the country's IT sector are not related to taxes, but rather to a shortage of qualified personnel. This was stated by the head of the department, Vahe Hovhannisyan, at a final press conference on December 25. He recalled that the department had previously opposed the initiative to reduce income tax for IT companies to 10%. , he explained.
In this regard, the Ministry of Finance supported a large-scale support package for the technology sector, including a reduction in the turnover tax from 5% to 2% and full compensation of income tax for startups when hiring new employees. Among other things, startups are offered a 50% compensation of income tax on employees sent to retraining programs, and larger companies (with more than 30 employees) are offered a 25% compensation of tax. In addition, the government will compensate 70% of the expenses associated with the trip for high-tech companies that will send employees abroad for retraining (the list of universities and training centers will be agreed upon later) (but within 2 million drams, that is, slightly more than $5 thousand).
"We realized that the obstacle for the sector is not taxes, but a lack of knowledge," the minister noted.
According to the results of 2023, there were 10,674 taxpayers in the IT sector in Armenia. This is the highest figure in the last five years. The turnover of the republic's IT sector exceeded 640 billion. However, according to the data for the first half of this year, the number of taxpayers decreased by 1,320, or 12.4 percent. At the same time, the number of employees also decreased. In 2023, 36,773 people worked in the sector, in 2024 - 34,814. That is, compared to last year, the number of employees decreased by 1,960 people, or 5.4 percent. Earlier, economist Aghasi Tavadyan identified several problems hindering the development of the IT sector. Firstly, this is the increase in the dram exchange rate against foreign currency. The second reason is the incorrect fiscal policy of the Armenian government. The turnover tax for small and medium businesses will increase from 5% to 10% from January 1, 2025. The profit tax benefits established for IT companies will gradually cease during 2024, and the reduced 10% profit tax rate will increase to 20% from January 1, 2025.
