Armenia`s government causes 5% price rise - businessman

ArmInfo. The Armenian government has raised prices by 5%. This assessment was made by the co-founder  and head of the Union of Entrepreneurs "Mantashyants" Vahram Mirakyan. "The phrase "the government/state raises taxes on the sector" is incorrect. To convey the essence of the phenomenon, the phrase "the government raises prices" should be used.

Because society always pays for tax increases, since businesses raise prices in response to tax increases.

For example, prices in our restaurant industry are now rising because taxes in this industry are rising.

Therefore, call a spade a spade: not "the government raised taxes by 5%", but "the government raised prices by 5%", he wrote on social media.

Turnover tax (replaces VAT and income tax) is paid by business entities whose annual turnover does not exceed 115 million drams (from January 1, 2020, Armenia returned to a non-taxable annual turnover of up to 115 million drams). In June 2024, amendments to the Tax Code were adopted, which entered into force at the beginning of this year, implying an almost double increase in the turnover tax rate, with the possibility of reducing the tax payable due to documented expenses. In particular, catering representatives previously worked with a 6% turnover tax with the possibility of a  tax deduction of 3% of documented expenses, but not less than 4% of turnover. But as a result of the revision, a 12% turnover tax was established with the possibility of a tax deduction of 9% of documented expenses, but not less than 3.5% of turnover. In this case, as noted by the Ministry of Finance, the effective tax will increase from 4.3% to 6.6%, providing the state treasury with additional taxes in the amount of 4.9 billion drams.