ArmInfo. "Following the presentation of Samvel Karapetyan's "5 Steps to a Strong Armenia" economic program, many compatriots are wondering if it's true that Samvel Karapetyan has decided to exempt all small businesses from taxes. Yes, it's true," stated Narek Karapetyan, Vice President of the Tashir Group and coordinator of the "In Our Way" movement.
Recall, on January 20, Narek Karapetyan presented five key steps. The second concerns exempting small businesses from taxes to enable them to grow into medium-sized businesses. According to him, the current tax burden leads to the closure of thousands of businesses every year. Last year, 3,000 small businesses closed due to the turnover tax increase from 5% to 10%. Karapetyan emphasized that the only condition they set is that medium-sized businesses not try to split up and become small. "This is a matter of administrative control. We will achieve widespread success in other areas. We must tell small businesses: grow until you become medium-sized, and we will support you. I assure you, we will find these 2% taxes from other sources," he added, noting that thanks to this policy, up to 3,000 new small businesses will open in Armenia annually.
Commenting on this statement, RA Finance Minister Vahe Hovhannisyan recalled that, as of January 1, 2020, under the preferential tax system for microenterprises, businesses with an annual turnover of up to 24 million drams are taxed at a zero rate. "Under this system, the taxpayer is not considered a VAT payer and, therefore, pays 0 drams in VAT," he wrote.
In this regard, today during a Facebook live broadcast, Narek Karapetyan announced the position of "Strong Armenia" (the party was registered by Samvel Karapetyan's supporters - ed.). "All small businesses operating in Armenia will be exempt from taxes. Small kiosks and shops, beauty salons, car washes, as well as small service providers, will be taxed at 0%," he said.
This policy, the coordinator of the "In Our Way" movement clarified, is economically justified and is being implemented to give these companies opportunities for growth. "So that with the savings they can create new jobs, attract new personnel, and we can overcome unemployment, the root cause of poverty," he stated. When asked how the authorities would replenish the state budget in this case, Narek Karapetyan shared an interesting statistic. "70% of companies operating in Armenia pay only 2.5% in taxes. This means that all businesses that are turnover taxpayers (whose annual turnover does not exceed 115 million drams - ed.) provide only 2.5% of the state budget's tax revenues," he pointed out, assuring that they would find a way to increase the budget not just by the aforementioned 2.5%, but by tens of percent, through large businesses and various programs.
"Imagine a country where small businesses are not taxed, where small businesses don't deal with the tax authorities, and the only goal facing small businesses is to expand. And only then, once they become medium-sized enterprises, can they pay profit taxes," the representative of the "In Our Way" movement concluded.
