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Government Offers Another Tax Reprieve To Protesting Traders


Armenia - Small business owners demonstrate outside the main government building in Yerevan, 30Jan2015.

Armenia - Small business owners demonstrate outside the main government building in Yerevan, 30Jan2015.

The Armenian government has moved to again postpone the enforcement of a controversial tax law in response to renewed street protests by hundreds of self-employed people and small business owners affected by it.

Prime Minister Abrahamian’s cabinet approved a five-month delay at an emergency meeting held over the weekend. The Armenian parliament dominated by government loyalists debated it on Tuesday. It will almost certainly approve the measure later this week.

The cabinet meeting followed Abrahamian’s talks with representatives of the protesters. They said he agreed to address their concerns over the law on a single turnover tax levied from their businesses mostly involved in retail trade.

The law was amended in October to require entities with annual revenue of up to 58.3 million drams ($122,000) to show tax officials documentary evidence of their transactions with wholesale suppliers. The government says that this will make it much harder for large-scale Armenian importers of goods to evade taxes.

The affected traders say that they cannot comply with this requirement because the suppliers routinely refuse to give them receipts. A series of demonstrations staged by them in September and October already forced the government to freeze relevant provisions of the law until February 1.

The fresh reprieve offered by the government split the protesting traders. Some of them believe that it represents only a temporary solution to their concerns and are demanding that the controversial legal provisions be scrapped altogether.

Opposition lawmakers also criticized the government tactic of placating the angry traders during parliament debates on the issue. Naira Zohrabian, a senior deputy from the Prosperous Armenia Party (BHK), said the government should have come up instead with a “final solution” to the issue.

The BHK, which controls the second largest parliament faction, has strongly supported the protests. Some of its members have actively participated in them, fuelling government claims that it the party exploiting the matter for its own parochial interests.

Such claims have been echoed by some of the traders who have decided to stop demonstrating against the government after the fresh concessions made by Abrahamian.

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