ArmInfo. The members of the Bar Club once again expressed dissatisfaction with the discriminatory tax policy of the Armenian authorities and announced their intention to hold a protest on February 10. This is stated in a statement received by ArmInfo from the Chamber of Advocates.
The statement recalls that the lawyers are demanding a legislative initiative from the Armenian government aimed at exempting the provided legal services from value added tax (VAT), which will enter into force on January 1, 2025, in accordance with the law "On Amendments to the Tax Code of the Republic of Armenia".
"At the meeting of the Bar Club, a decision was made to suspend the protection and representation of clients' interests in state bodies of the Republic of Armenia, including courts and preliminary investigation bodies," the statement reds.
The Chamber of Advocates explained what consequences the application of the new law may have. According to their statement, the law significantly worsens the protection of violated rights of citizens, excludes the possibility of providing free legal aid and significantly increases the cost of legal services. This limits access to legal aid and complicates the implementation of judicial protection, creating an unforeseen financial burden for lawyers and legal organizations that are obliged to continue to provide assistance under already concluded contracts.
"The application of this law also creates discriminatory conditions for citizens - individuals. Unlike commercial organizations that pay VAT, the cost of legal services for citizens increases by twenty percent. This leads to an additional burden on lawyers and increases expenses, since there is a need for accounting services. In addition, the law limits the development of the legal institution, significantly complicating the creation of new law firms due to the high tax burden, and creates discriminatory conditions for lawyers compared to other sectors of the economy where preferential tax conditions apply," the statement explains.
According to the source, the recent actions were also presented at the meeting. In particular, lawyers sent a petition to the government signed by about 1,200 lawyers asking to exempt free and voluntary legal aid from VAT. In addition, 31 deputies filed a complaint with the Constitutional Court challenging the constitutionality of the provisions of the current Tax Code concerning the legal profession.
Recall that earlier, the Chamber of Advocates of Armenia sent a collective petition to the government of the country asking to reconsider the amendments to the law, which provide for an increase in the taxation of legal activities.
In connection with the amendments initiated by the government, which were adopted by parliament, the taxation of legal activity will increase from the current 5% to more than 30%. In addition, the accounting procedure will change: if previously it was conducted on the basis of turnover, now it will be necessary to take into account expenses, which will lead to additional costs.
Lawyers criticized this initiative of the authorities, noting that this will significantly increase the cost of their services for citizens and may lead to a situation where certain segments of the population will be deprived of the opportunity to use legal assistance.
