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Government Offers Concessions To Traders


Armenia - Market traders protest outside a government building in Yerevan, 2Oct2014.

Armenia - Market traders protest outside a government building in Yerevan, 2Oct2014.

The Armenian government moved to make concessions to scores of angry market traders on Monday in response to their continuing street protests against new taxation rules introduced by it.

Prime Minister Abrahamian instructed Finance Minister Gagik Khachatrian to draft relevant legal amendments after holding two more meetings with leaders of the traders in the space of several hours. Khachatrian also met them separately.

The four representatives of the protesters announced after the talks that they reached a compromise agreement relating to recent changes in an Armenian law on turnover tax, which is levied from businesses with annual sales of up to 58 million drams ($140,000). The latter pay no other taxes.

The amended law, which took effect on October 1, lowered from 3.5 percent to 1 percent the turnover tax rate. However, it obligated the small business owners to provide tax authorities with documentary evidence of their wholesale purchases made from larger firms or face heavy fines.

The traders say that they cannot comply with this new requirements meant to complicate tax evasion because their suppliers usually refuse to issue them with receipts and invoices. Hundreds of them have demonstrated outside Abrahamian’s office over the past two weeks. Angry protests have also been reported in other parts of the country.

“These protests will only intensify. They could become a Waterloo for these authorities,” one trader in Yerevan told RFE/RL’s Armenian service (Azatutyun.am) as the protest leaders met with Abrahamian.

One of those leaders, Samson Grigorian, told the crowd after the first meeting with Abrahamian that the government is taking its concerns seriously. “They say that they don’t want small businesses to close down,” he said. “They will do everything to find a solution to this dispute.”

A government statement released late in the evening said the prime minister instructed Khachatrian to draft a number of amendments to the law on turnover tax within the next three days. It said that the amendments, if approved parliament, will extend from October 10 to next February a deadline for stock inventories which must now be conducted by the traders in a manner required by tax officials.

The finance minister was also given until the end of this month to propose ways of simplifying what the traders see as complicated procedures for complying with the new law.

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