The government reported on Friday a more than 21 percent surge in its tax revenues in the first half of this year, putting it on track to further strengthen Armenia’s fiscal position.
The Armenian Finance Ministry said the State Revenue Committee (SRC) collected almost 480 billion drams ($1.2 billion) in various taxes in this period. Ministry data shows that increased proceeds from value-added tax, mostly levied from imported goods, and customs duties accounted for most of this gain.
Armenia’s first-half imports fell by around 2 percent, suggesting that improved customs administration was the main factor behind the higher tax revenue.
The revenue increase also translated into a budget surplus of 47.2 billion drams. This is due in part to the fact that the government carried out only 91 percent of budgetary expenditures planned for January-June.
Armenia’s 2013 state budget commits the government to cutting the budget deficit to a level equivalent to less than 3 percent of Gross Domestic Product. The rising tax revenue puts the government on course to meet this target. It will also give more credence to government claims that tax collection in the country has been steadily improving.
President Serzh Sarkisian emphasized that improvement last month, while cautioning that there is still “serious work” that remains to be done by tax authorities. He said his government remains committed to completing “large-scale” tax reforms.
Tax collection in Armenia has long been arbitrary and at the same time insufficient as evidenced by a low ratio of tax revenues to GDP. Local entrepreneurs still accuse the SRC of harassing them to meet its budgetary targets at any cost.
Western lending institutions have been pressing Yerevan to improve tax administration and the overall business environment, saying that is vital for Armenia’s sustainable economic development.
The Armenian Finance Ministry said the State Revenue Committee (SRC) collected almost 480 billion drams ($1.2 billion) in various taxes in this period. Ministry data shows that increased proceeds from value-added tax, mostly levied from imported goods, and customs duties accounted for most of this gain.
Armenia’s first-half imports fell by around 2 percent, suggesting that improved customs administration was the main factor behind the higher tax revenue.
The revenue increase also translated into a budget surplus of 47.2 billion drams. This is due in part to the fact that the government carried out only 91 percent of budgetary expenditures planned for January-June.
Armenia’s 2013 state budget commits the government to cutting the budget deficit to a level equivalent to less than 3 percent of Gross Domestic Product. The rising tax revenue puts the government on course to meet this target. It will also give more credence to government claims that tax collection in the country has been steadily improving.
President Serzh Sarkisian emphasized that improvement last month, while cautioning that there is still “serious work” that remains to be done by tax authorities. He said his government remains committed to completing “large-scale” tax reforms.
Tax collection in Armenia has long been arbitrary and at the same time insufficient as evidenced by a low ratio of tax revenues to GDP. Local entrepreneurs still accuse the SRC of harassing them to meet its budgetary targets at any cost.
Western lending institutions have been pressing Yerevan to improve tax administration and the overall business environment, saying that is vital for Armenia’s sustainable economic development.