ArmInfo. In Armenia, state-funded agricultural programs will not be subject to profit tax, but will be assessed as assets in constructed buildings and infrastructure. At its February 27 meeting, the National Assembly's Committee on Economic Affairs approved the Tax Code amendments submitted by the Armenian government for the second reading.
According to Arman Poghosyan, Deputy Minister of Finance of the Republic of Armenia, funds provided by the state for assistance programs in various agricultural projects (intensive orchards, smart farms, equipment leasing, etc.) are currently subject to profit tax from the year the financial resources are received. However, there are often cases where program beneficiaries make investments and then approach the government for co-financing for certain projects, even though these investments were made several years earlier. Consequently, support funds may expose beneficiaries to tax liabilities and, as a result, a negative balance for them. Therefore, according to the legislative initiative, state-co-financed programs will not be subject to profit tax from the year in which the financial resources are received, but will be assessed as assets in constructed buildings and infrastructure. This problem is particularly acute in the agricultural sector, which is exempt from profit tax until the end of this year. However, due to related incidents in the sector, tax liabilities arise. According to the amendments, if related incidents exceed the sale of agricultural products by 10 percent or more, this type of activity is subject to profit tax.
The bill will be retroactive and will apply to relations from January
