A senior official downplayed on Tuesday the fact that Armenia’s tax revenue from imported goods will fall short of a 2016 target due to an economic downturn in Russia and other members of the Eurasian Economic Union (EEU).
Vakhtang Mirumian, a deputy head of the State Revenue Committee (SRC), referred to proceeds from uniform import duties that are collected by the EEU member states and then distributed among them on the basis of fixed quotas.
Recession-hit Russia, Kazakhstan and Belarus have imported fewer goods this year, meaning that the EEU’s combined customs revenue will fall this year. According to the SRC, Armenia’s customs revenue shortfall totaled 4 billion drams ($8.4 million) already in the first quarter of 2016.
Mirumian insisted that despite the deficit Armenia is now “better off” financially because of its membership in the Russian-led trade bloc.
“If we had collected our customs duties on our own, our revenue from them would have stood at about 23 billion drams,” he told reporters. “In the first nine months of the year, we received 38.5 billion drams [from the EEU.]”
The decreased customs revenue has only added to the Armenian government’s fiscal problems resulting from worse-than-expected tax collection, which means that it may fail to meet its spending targets set in the 2016 state budget. The government’s total tax revenue fell by 1 percent year on year in January-September.
This might explain why the government plans to cut public spending next year despite continued economic growth anticipated by it.