Yesterday the Audit Chamber of Armenia convened its regular session, during which they were discussing the activities of 5 sectors – justice, finances, sports and youth ministries, the functioning of the aviation and the activity of the social foundation of 2007-2008. The Audit Chamber was able to inspect only a part of the activities of these bodies during the period of the past two years.
Aviation
The worst picture is with the sector of aviation. The Audit Chamber found out that in Armenia the Air companies are registered free of charge. The head of the Chamber Ishkhan Zakaryan says the Armenian department of aviation registered 12 companies in Armenia the activities of 9 of which were held abroad. Ishkhan Zakaryan says that if one of them registered in the United Arab Emirates, it would have to pay 320 million dram and in London, the sum would be equal to 1 billion dram. Ishkhan Zakaryan notes that in 2008 the 9 companies working abroad paid to the Armenian budget only 37 million dram altogether while the ArmAir company which in 2008 used only 1 helicopter to spray trees etc. paid 41 million dram. The other Air companies registered in Armenia, ArmAvia and Air Armenia paid 1 billion 30 million and 27 million dram each.
Zakaryan notes that the fact that companies registered in Armenia but working abroad pay little taxes is the problem of the tax service and not the aviation service. Thus, Taron air carrier which exploited 1 airline in 2007 and 4 airlines in 2008 worked without income in the above period and paid no taxes. The same situation with slight differences exists among other companies. Some of them added the number of their planes in 2008 compared to 2007 but the amount of taxes didn’t increase. In 2007 the Click Airways company had 2 airplanes and didn’t pay taxes. In 2008 it had 5 planes but paid only 167 thousand 500 AMD. The South Airlines exploited 22 and 20 airplanes during these two years and only in the second year paid taxes in the amount of only 1.2 million AMD. The Hayk Avia, Vertir, Phoenix Avia, Mega Airlines and Blue Airways worked with the same “responsibility.” Armenia has 12 registered air companies, of which 9 operate abroad and 3 – in Armenia. In that connection, Zakaryan noted that registration of such air company might cost $ 382 million in UAE and over $ 1 billion in Britain. According to him, none of companies operating abroad duly paid taxes in 2007-08. “Tax payments of those 9 air companies totaled AMD 37.2 billion for 2007-08,” he said. As regards air carriers operating in Armenia, Armavia exploited 7 airlines in 2007 and 8 airlines in 2008 and paid taxes in the amount of AMD 1.3 million. Air Armenian which exploited 5 airlines in 2007-08 paid AMD 212 million, while Armairo which possesses only 1 helicopter paid a total sum of AMD 41.3 million, which exceeds the tax payments of the above-mentioned 9 companies. “There are serious problems in the sphere, so it is necessary to amend the relevant legislation,” Zakaryan noted. The chairman of the Audit Chairman added that there is the necessity of legislative reforms especially in the field of registering fares. But in the aviation department as a result of the inspections violations worth of approximately 12 million AMD were revealed.
Ministry of Finances
Financial and documentary violations were identified in the activity of the Ministry of Finances. Here the noteworthy thing was the activity of casinos, the license of which is given by the Ministry of Finances. Hence, it was found out that in previous year licenses for 102 tables were issued but only 42 of them paid the price to the budget for a table which is 4 million a month. In case of the resting 60 tables, the owners presented certifications that those tables do not work. Ishkhan Zakaryan states there is a serious danger of corruption and there is necessity to make amendments to the law. According to Zakarayn, a law should be adopted which will provide for owner of a table to pay the fixed 4 million regardless the table works or not. There was registered another interesting tick in the work of casinos. The point is that the casino owners have to register the importation of casino objects at the ministry of finances noting the place from where they imported them. According to the international rule on casino automats, it has to return the 86 percent of the sum played on it. But it was found out that the Armenian casino automats pay back only the 5-10 percent of the sum played on it. These automats are said to be imported but according to Zakaryan in reality, only the “brain” is imported and after the object is transformed and adapted to the local conditions. The result is that instead of 86 percent the automat gives back only the 5-10percent. The picture of the jewelry stores was also interesting. A number of popular jewelry stores showed that during the past two years they have monthly sold 250-500 grams of gold. In particular, Ishkhan Zakaryan noted “PrimaGold”, “Merkuri” and “Gianni” shops which showed to have imported in 2007 only 200 gram, 525 gram and 17 gram of gold a month and in 2008 -542, 433 and 0 gram of gold. “In case of a good wedding each of these shops may sell several kg of gold”, says Zakaryan. As a result of the audit of the ministry of Finances other violations were revealed as well but those were fixed over time. The minister of finances Tigran Davtyan, who was taking part in the session, said that the ministry’s and the audit chamber’s approaches are pretty much the same. By the way, Zakaryan with content mentioned that the violations revealed by them are being fixed quicker over time.
There are violations everywhere
Financial violations were revealed especially in the construction activities in penitentiaries and half of the identified violations worth of 65 million AMD have been fixed. Financial violations were revealed in the activities of the DAHK. An NA MP Anahit Bakhshyan, who was present at the session, mentioned that besides the violations in the construction sector of the penitentiaries the rights of the convicts were also degraded and trampled. Does the Audit Chamber pay attention to this? Zakaryan responded that this is not included in the competence of the Chamber. The violations in the Ministry of Sports and Youth Issues had an interesting picture. Moreover, in this case the board of the Chamber thought of presenting a proposal of excluding violations for this ministry but an Advisor to the President of RA Seyran Avagyan suggested using the formulation “recover.” In the words of the latter it is hard to exclude violations in the sphere of construction. The sportsmen were paid less per diem during their international visits. The Minister of Sports and Youth Issues Armen Gevorgyan said that by doing so the state benefited. Violations worth of 25 million AMD were revealed in the Foundation of Social Investments. In the words of Zakaryan these violations were recovered. The chair of the Audit Chamber also informed that a part of the violations within the Ministry of Culture presented in the previous session was recovered and the rest will be recovered soon. The case against Gugark company in charge of the reconstruction of Henavank and Kobair historical monuments (financial abuse in the amount of 50 million AMD) is currently in the prosecutor’s office. By Zakaryan’s information the director of the company is imprisoned. The underpayments in the amount of 440 million AMD were fully recovered.
P.S. Let us also add that this time instead of holding its session with the journalists in the hearing hall of the National Assembly the Audit Chamber gathered in Metropol Hotel. Let us recall that Metropol belongs to an Advisor to the RA President, former minister of transportation and communication Andranik Manukyan. Zakaryan said that till the end of the year the Audit Chamber will meet the journalists in Metropol Hotel as the hearing room of the NA will be busy due to budgetary discussions. Zakaryan also ensured that the hall of Metropol is given them for free and the receptionist of the hotel told us that he cannot tell us how much the Audit Chamber paid for the rent of the room because it is a commercial secret.