Cash machines are the last hopes

18/09/2009 Babken TUNYAN

Prime minister Tigran Sargsyan will stay in the history of Armenia as a person, who eventually could make the Armenian drivers use the security belts of their cars.

In fact Tigran Sargsyan could do it not as a result of hard work or fantastic efforts but due to the fact that at least he could realize one thing. And this simple fact is that everywhere in the world you should stimulate people but not make them do what you want. Simply drivers use the security belts not due to the fact that they want to be secure, but they don’t want to lose 5.000 dram. If the government manages to keep this control active during a long period, drivers will get used to it and will use the security belts, because even in Europe it took some time from people to get used to it. The fright of losing money or opportunity to make money easily are the best tools to stimulate people. The government understood this fact long ago, they understood this simple fact when they decided to organize lottery with cash machine receipts. As a result, the opportunity of winning a lot of money made even the most shameful people to stand at the desks and wait for their receipts. Later they improved the mechanism and applied the method of bonuses. The result was more effective than expected because even the most shameful citizens demanded from sellers to give them receipts, thus making them pay taxes as well. Recently the government made a decision to prolong the allocation of the money for this quarter because the money they had for bonuses was not enough to pay the bonuses as they had collected more than had been planned. “In fact this decision means that more money was collected than had been planned. Fifty thousand citizens have received and will receive bonuses. Plus, due to this system the state committee on incomes has collected more 5 billion dram. It is clear that this method helps to fight the shade in the economy and with the help of citizens make businesses pay taxes. We plan to increase the budget incomes from such taxes in the next quarter, thus we will pat more money to citizens. The ice is cracking and citizens are making the sellers give them receipts, thus making them pay taxes as well,” said Tigran Sargsyan. In fact the game the government has started is success and it is trying to make people understand that no one loses, both the government and citizens win. It helps to increase the budget incomes. According to the information of the ministry of state incomes, the budget collection during the eight months of 2009 compared to the same period in 2008 increased by 40 billion dram, as a result of which it is expected that the tax incomes will grow by more 3 billion. “The state incomes ministry, with the help of citizens, is enlarging the spheres under tax coverage,” said Tigran Sargsyan. There are two methods how citizens can help the state incomes committee; it is when they ask the sellers to give them receipts and when they inform the committee about those who fail to give them such receipts. If businesses fail to give receipts, they will have to pay 75 thousand dram as penalty. If businesses repeat the same thing within one year since the first penalty, they will have to pay 150 thousand dram and their businesses will be closed for five days. And if they do the same thing for the second or more times, they will have to pay 300 thousand dram and their businesses will be closed for ten days,

Now let’s discuss the facts. According to the information of the state incomes committee, during January-September the operation of about 700 businesses was suspended as a result of failure to issue receipts, 76 businesses out of which had done it for the second or more times.
 
Only in August and September the operation of 124 companies was suspended for ten days. It means that dozens of millions have paid to the budget in this period. Over 90% of the companies, which have violated the laws and regulations on cash machines are operating in the sector of retail trade. Now it is clear who is losing when the citizens and budget are winning.

However we should not worry because on the way of cutting down the shade of economies always there are businesses that lose. I would worry more about the fact that in the case of improving the traffic or tax collection mechanisms most of citizens are not doing it consciously but are stimulated with money. If the government manages to change this mentality, everything will go faster. However, in this case the problem is that it would be much more difficult to buy votes for 5.000 dram during elections. Thus, it would be better if the government was changed itself, which cannot happen in the near future due to understandable reasons.