Last year, the National Assembly adopted a law on defining privileges for businessmen who have fulfilled obligations of social payments and income tax. The law is currently applied. This is what we spoke about with the deputy head of the State Tax Service (STS), Armen Alaverdyan.
– The law on “defining privileges for businessmen” has become active. Can you tell us how many people have applied with a request to be liquidated so far, or how many have paid the 30% obligation?
– We do not have such summarized statistics. Not many people have applied yet, but the deadline is May 1. Due to some “Armenian” factors, many businessmen are not in a hurry to write a liquidation letter. I think the less time we have before the deadline, the greater the number of applicants. We will summarize the quarterly data and we will let you know.
– How do you keep people informed?
– We have mainly informed people through the mass media. With this purpose we will do many things in March since we are planning to send letters to businessmen with the help of international organizations. If possible we will try to personally introduce people to this regulation via “Armpost”. We do not have such a law on this, but we will use that opportunity as well.
– Would you please comment on the basic provisions of the law?
– There are three strata for businessmen. The first stratum are those people who would pay the 30% obligation, will be free from paying penalties and will have the same status as they used to have. The second group includes people who will not pay, they will just write an appeal letter and will be liquidated. And the third group includes people who will neither pay nor write liquidation letters. In this case, taxing officials will liquidate those businesses themselves. Those businessmen will be able to continue their businesses for the coming five years only if they pay all their obligations. This clause mainly concerns people who are not willing to work with the state.
– Is there a possibility to adopt a similar law for limited trade companies?
– We don’t have projects like that at this moment. Any kind of amnesty reduces tax discipline and creates a feeling among businessmen that they don’t have to pay because finally they have an amnesty. That’s the reason why we are kind to only a limited number of businessmen. If legal entities do not pay their obligations, either their property will be confiscated or they will be considered bankrupt. We do not have grounds to do them a favor, however the situation is slightly different for private businessmen.
– How do you explain the fact that in the list of 300 largest taxpayers, profit and income taxes are presented jointly? Unlike the lists of previous quarters, this one does not show who worked with profit and who had losses.
– This list is different from others in that, taxes paid at customs were also included. This one gives a better understanding about the taxes paid by businessmen and also how they look at paying taxes. Regarding the profit tax and income tax, we will inform businessmen later.
– When presenting his report to the Prime Minister, Felix Tsolakyan mentioned that, many big businessmen show their incomes at a lower level, however they show correct numbers, and thus it becomes impossible to reveal the violations. Do the tax bodies do anything in this regard, or have they gotten used to the situation?
– We can never accept this. The 300 large taxpayers provide 70% of total tax inflows. Therefore, we must pay more attention to those lists (not only tax bodies, but also society, media, NGOs etc) and progress. We can see that the energy system, banks, industrial enterprises, and the higher education system are greatly reflected in the list. Although certain organizations are included in the list, I think that they should have occupied a higher position. You may follow how much those organizations advertise their products via TV and then compare themselves on the list with the amount of paid taxes. We do researches and determine risky sectors for us. We are not only responsible for the government, but also for the society.
– When you mention that payments are not sufficient, is it only an assumption, or a concrete calculation?
– Indeed calculations are done for all organizations. We can report on each organization that appeared in the list. When I say that it is not sufficient I mean, that we should pay more attention to those issues this year. We should make sure that companies show their actual turnout. When we say “shade” we don’t mean only the unregistered enterprises. We strongly believe that there is a greater “shade” among registered companies rather than unregistered ones.
– In this regard, are there any issues concerning professionalism of tax-inspectors?
– I think that there is lack or abundance of professionalism in all sectors- journalism, healthcare, science, tax sectors. All those sectors need qualified specialists. Let me also mention that many of our employees often move to the private business sector, where salaries are much higher. We mainly emphasize the role of the younger generation, because they have a modern mentality. Although, let me mention that we have serious issues with higher education too. There are many economy graduates who know anything about economy. Of course it is difficult, but we choose by competition. Last year about 800 people applied for only 200-210 vacancies. However, let me mention that there are also many brilliant young economists who just lack experience.
– Tsolakyan, had also spoken about cases of sponsorship.
– We have to admit that there is sponsorship in all sectors, in our case it’s OK because we are dealing with finances. In the result of income distribution, interests often collide, and there are special groups of people who have those interests. The number of these people also includes high and middle ranking authorities. In certain cases these people are owners of businesses. The reality is that we are still dealing with this. The president of Armenia also assigned us to do away with this. Believe me, to some extent the discussion of such issues reduces the risk of such sponsorship. No authority figure would wish to see his name on the front page of a newspaper. So this issue should be discussed in a constructive way.
