YEREVAN, June 19, /ARKA/. The Armenian parliament began today consideration of a government-drafted package of legal amendments that will reduce from 3.5 percent to 1 percent the rate of turnover tax paid by trading companies with annual sales of up to 58.3 million drams ($140,000) and also exempt from taxes so-called “family business” whose annual turnover does not exceed 12 million drams.
If passed the bill would come into force form October 1. The government believes the bill will give a major boost to these businesses. However, according to preliminary estimates, the budgetary revenue will drop by 8 billion drams.
Prime minister Hovik Abrahamyan said earlier this month that the resulting loss in tax revenue would be made up by increased collection of taxes from large businesses.
Turnover tax was enforced by the previous government in January 2013. It replaced profit and value-added taxes paid by small businesses engaged in retail or wholesale trade. -0-