By Emil Danielyan
The Armenian tax authorities ensured a 22.4 percent increase in their revenues in the first quarter of this year and are on course to meet their annual target set by the government, a senior official told President Robert Kocharian on Tuesday.
Felix Tsolakian, head of the State Taxation Service, said his agency collected 35 billion drams ($77.6 million) worth of taxes or slightly more than was projected by Armenia’s 2005 budget.
The reported figure does not include proceeds from the collection of employers’ and workers’ social security contributions that are used for payment of pensions. According to Tsolakian, they jumped by almost 36 percent to 12.9 billion drams during the period in question.
The overall budgetary revenues from the collection of taxes and import duties are projected to rise by about 25 percent to 307 billion drams ($680 million) this year. The authorities must meet the target in order to ensure a corresponding increase in public spending envisaged by the 2005 budget.
Officials attribute the improved revenue collection to a crackdown on tax evasion which was announced by the government last January. It has focused on the widespread underreporting of the number of employees and the amount of their salaries by employers.
Kocharian was quoted by his press service as instructing Tsolakian to “pay serious attention to the correct organization of the collection of social contributions.” It was not clear if he referred to reports that tax officials are illegally extorting payments from small- and medium-sized businesses as part of the crackdown.
Representatives of some of Armenia’s business associations alleged last February that the practice is routine. They accused tax officials of primarily targeting businesses not controlled or owned by them.
(Presidential press service photo: Kocharian meeting with Tsolakian.)