The situation in the parliament is becoming tense and the MPs, who represent the “economic bloc”, are discussing the bill on amending the law on tax collection in different formats not to impact their interests.
Yesterday the standing commission on economic affairs discussed the issue with Suren Karayan, deputy minister of finances. Following this discussion some MPs, who are businessmen as well, informed us that the government did not want to accept their recommendations. The main disputable provision of this bill concerns the government’s initiative to appoint representatives in major businesses. The MPs say that they don’t mind if the taxation services appoint representatives in their companies but they are against any intimidation on their businesses and a foreign eye on their financial activities. The businessmen say that if the government wants to control the price formation, they can appoint people in the whole sale trade centers to control the price of prices upon whole sale circulation. They don’t want anyone to know anything about their commercial secrets. This bill also contains provisions on appointing representatives not only in big companies, but excised product producers as well. In this case the taxation services may have representatives not only in big companies, but in small and medium companies, which products are subject to excise tax. For example, tax inspectors may stay at a company which produces 2000 bottles of wine or 1000 boxes of cigarettes a year.
Yesterday the businessmen MPs were trying to make Mr. Karayan understand that businesses will not bear the breath of the taxations services on their necks and it is impossible to bear them watching their activities all the time. MP Areg Ghukasyan, who is also the owner of Avan community salt mines, was trying to explain the practical and psychological problems which could arise as a result of unreasonable interest on part of tax inspectors. Mr. Ghukasyan was explaining that businessmen would not be able to bear them and there could be conflicts with tax inspectors. “Is this what you want to do? Do you want us have conflicts or beat up other or close down everything and leave?” asked the MP.
S. Karayan was in a difficult situation and could not find explanations concerning the amendment bill proposed by the government. What is the purpose of a permanent representative of taxation services in companies? “We want to increase the level of control over the activities of big businesses,” said S. Karayan.
The MPs have calculated and pledge that over 100 big and 200 excise taxpayers will be covered by this law. At the same time, the businessmen assure that only ten companies out of these 300 companies have privileged rights in the business environment and don’t pay taxes fully. Most of these companies are surviving by fighting with the pressure apparatus of the state. Besides that, the MPs believe that the State Income committee has all the tools and mechanisms necessary for taxing the shadowed businesses. They refer to the example of MP Khachatur Sukiasyan’s businesses and say that if they want they can do anything like they discovered a lot of alleged things and closed down Khachatur Sukiasyan’s businesses. They say that these changes are done for other purposes and it will impact the local producers and businesses. Importers can register the imported products in the name of several companies and escape from paying taxes but the domestic producers cannot escape from taxes by doing so. Since 2009 the agriculture sector is taxed and those having more than 58 million dram income should pay taxes. The big agricultural companies found a solution and registered their properties part by part with other companies. One of the MPs, who has a company which produces goods, says that they have informed the government and taxation services of all the details and nuances of the business environment and were told that it is the same for the government who is taxed, there is no difference for them whether they tax importers or producers. In fact, it turns out that the authorities are giving better opportunities to importers. The businessmen say that if there is a tax inspector permanently sitting in one company, buyers will be afraid of buying products from such company in order not to be noticed too. The MPs say that several years ago as a result of devaluation of the US dollar the domestic producers suffered first and they believe that if this bill is adopted, it will be the second biggest impact on domestic producers. “If it happens we will have to close down our companies,” said the businessmen MPs.
The owner of Great Valley brandy company Tigran Arzakantsyan says that through this policy the state will enroot corruption in the country. He believes that businessmen will try to bribe the tax officials to stay far from them. MP Michael Vardanyan believes this initiative will not be successful. He says that the government intends to hire 60 tax officials to carry out this duty. This number of people will not be enough to control the activities of the mentioned 300 companies. In addition, businessmen believe that this policy is to strengthen the mechanisms of control over businesses on part of the authorities. They believe that those companies which don’t pay taxes will not be taxed and the ones to suffer will be the other companies. This mechanism will be mostly used for the purpose of punishing businesses and their owners. In a word, the MPs have decided to go against the government, which is pretty strange. The MPs, who have businesses, were stopping their colleagues yesterday and asking them either not to vote for the bill or be absent. The bill will be discussed either today or tomorrow. The Heritage faction has informed that they will vote against the bill. The PA, ARF parties and some MPs from RPA party are against the bill too. Of course it does not mean that they will vote against the bill in practice because the authorities know how to explain things to MPs separately.