Yerevan Municipality offers tax benefits for incomplete projects to  developers

ArmInfo.  The Yerevan Municipality wants to provide tax benefits and write off fines to  developers of apartment buildings that have not received final acts  of acceptance of the work performed. The corresponding draft law was  presented during the meeting of the Council of Elders on September 9  by the acting head of the Department of Accounting and Collection of  Income of the Yerevan Municipality David Hakobyan.

"It is proposed to revise the procedure for calculating the tax for  buildings that are under construction and have not received final  acts," he noted.

In particular, it is proposed to apply a 25% benefit to the  beneficiaries of the project on the calculated and unpaid property  tax for the period from 2023-2025 and to write off fines for the same  period.

After the application of the planned preferences, developers of  apartment buildings that have not received final acts may receive  benefits for the rest of the property tax. In particular, as Hakobyan  explained, in the case of real estate up to 50 sq.m. - the tax will  be reduced by another 25%, and in the case of real estate of 50 sq.m.  and more - by 50%. The envisaged concessions will not be applied if  the builder was issued a final act before they were provided, or if  the construction permit expired and was not extended in the  prescribed manner.

"The development of such a bill is due to the need to solve the  problems that have arisen in practice among numerous construction  companies. According to the current legislation, from 2023, property  tax is levied on construction programs also on objects under  construction. This creates serious challenges for the implementation  of investment construction programs, while new unforeseen financial  burdens are added.  As a result, many construction companies may find  themselves on the verge of bankruptcy, thousands of families will not  receive the promised apartments, which will entail difficult economic  consequences, harm the investment environment, and the pace of  implementation of new construction programs will decrease, which will  have a negative impact on the business environment," noted the  acting. Head of the Department of Accounting and Revenue Collection.