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Tax Chief Cleared Over Business Ownership


Armenia - Gagik Khachatrian, head of the State Revenue Committee, at a news conference in Yerevan, 20Feb2013.

Armenia - Gagik Khachatrian, head of the State Revenue Committee, at a news conference in Yerevan, 20Feb2013.

Gagik Khachatrian, the controversial chief of Armenia’s tax and customs services, has not abused his position to enrich himself or his relatives, according to a state anti-graft body that has investigated corruption allegations leveled against him.

The state Commission on the Ethics of High-Ranking Officials launched the inquiry last month in response to a petition from the Anti-Corruption Center (ACC), the Armenian branch of the Berlin-based watchdog Transparency International. The ACC in turn cited an article published in the pro-opposition daily “Haykakan Zhamanak” last October.

The article contained a long list of companies which it said are owned by Khachatrian. Among them are a major Internet and cable TV service provider, two food-importing companies, one supermarket, a car dealership and a luxury watch store in Yerevan. According to “Haykakan Zhamanak,” the head of the State Revenue (SRC) also controls a company that has a legal monopoly on supplying paper for cash registers used by thousands of businesses.

In its written findings made available to RFE/RL’s Armenian service (Azatutyun.am) over the weekend, the commission said Khachatrian does not formally own any of those firms. But it said that two of those entities -- the Mitsubishi car dealership and the Apeyron food-importing company -- belong to his children, while four others are controlled by his cousins.

The commission, which is located at the presidential administration building in Yerevan, insisted that this fact does not amount to a conflict of interest. It said that Khachatrian has made no decisions in his capacity as SRC head that have benefited the businesses registered in his children’s names.

Speaking to RFE/RL’s Armenian service, Sona Ayvazian, the ACC’s deputy director, dismissed this conclusion as “dubious.” Ayvazian said the commission failed to thoroughly investigate activities of the firms owned by Khachatrian’s relatives. In particular, she said, the state body should have scrutinized the amount of taxes paid by them to see whether they might have enjoyed privileged treatment.

The SRC denied Khachatrian’s involvement in business earlier in April. Khachatrian, for his part, claimed afterwards that the declared corruption inquiry is the result of a long-running smear campaign targeting him.

Opposition-linked and independent media outlets have for years portrayed Khachatrian as one of the country’s richest men.

In an annual report released in March, Armenia’s state human rights defender, Karen Andreasian, said that owning businesses is the norm among tax and customs officials. The report said some of the companies belonging to them or their cronies enjoy privileged treatment by the tax authorities, undermining their competitors. The SRC denied that, saying that the ombudsman failed to come up with any concrete examples.
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