Armenia imposes temporary restriction on export of copper and molybdenum concentrates
YEREVAN, March 3. /ARKA/. The Armenian government has imposed today a temporary restriction on the export of copper and molybdenum concentrates, as well as on molybdenum and products made from it to third countries. The government has also established a procedure for export licensing.
Economy Minister Vahan Kerobyan recalled that earlier the ministry had come up with an initiative to establish additional duty on the export of copper and molybdenum concentrates, ferromolybdenum and other similar products to increase government’s revenues.
"We planned that the rise would bring as much as 35 billion drams in 6 months, and this is exactly the amount that was collected additionally," he said.
On July 12, 2021, the Armenian government approved a set of amendments to the Law on State Duty, saying the amendments were prompted by the need to regulate foreign trade in goods which are of strategic importance for the country- copper and molybdenum concentrates as well as ferromolybdenum.
The government explained the move by the rising prices for non-ferrous metals. According to the government, high profits from the exploitation of the country's subsoil will be directed to the development of the manufacturing industry, strategic assets in the mining sector and deepening production value chains.
The government said the amendments were a temporary solution pending a complete and in-depth revision of the sector-related policy.
In the long term, it is planned to revise the tax policy of the industry in order to ensure effective taxation of excess profits from the use of the country's subsoil.
Armenian Prime Minister Nikol Pashinyan added that Mher Polozkov, now the former CEO of the Zangezur copper and molybdenum combine, charged earlier with huge tax evasion, paid 15 billion drams (about $30 million) in evaded taxes following a court ruling.
The tax evasion was tracked down by the State Revenue Committee, which said earlier that the combine concluded in 2016-2017 streaming agreements with UAE-registered companies, which acted as intermediaries.
According to an earlier statement, issued by the State Revenue Committee, if the average international price of the concentrate was $6.5 thousand (per ton), the Zangezur combine sold the concentrate to the intermediary company for $2 thousand. As a result of a number of such deals, the combine did not receive as much profit as it would have received in the absence of intermediaries. Pashinyan stressed that no money of the combine was used to recover the 15 billion dram worth tax evasion. According to him, the 15 billion drams were paid from Polozkov’s own funds.
The Zangezur Copper-Molybdenum Combine is one of the largest companies in Armenia, which topped for years the list of Armenia’s 1000 largest corporate taxpayers. The combine is located in the town of Kajaran, developing the Kajaran copper-molybdenum deposit. According to experts, there is enough copper ore for the combine to develop the deposit for another 150 years. -0-
