Who prefers cash transactions?

11/02/2012 Babken TUNYAN

One of the most discussed political topic of the week was the bill on “limitation of cash transactions”. The discussions were concentrated not on the bill but the processes that were happening between the coalition powers around the bill.

The PA party did not take part in the voting and failed it. The Heritage did not take part in the voting either, and the ARF abstained. The RPA representatives were confused not because of the behavior of the Heritage and ARF faction, but their coalition partner. The RPA representatives were saying that to vote against the bill meant to vote for corruption.

“Those who are speaking of honesty, dignity and tax collection and will praise their policy in the society had to show that their words and actions were similar… The PA’s action several months before the election is a bad PR trick as a coalition power is trying to fail the government’s bill to imitate an image of an opposition power. However it is clear that the PA will fail to blow the minds of voters because they cannot have the image of an opposition power after being in the government for so many years,” said NA speaker Samvel Nikoyan.

It was very strange because the RPA has majority in the parliament and can pass any bill without the other parties. On the other hand, maybe they were not able to provide the participation of their representatives in the NA sitting. It turns out that not only the PA, but the RPA people too should prove that they do what they say. The PA representatives said it was not a political issue and asked not to make a topic for political discussions. There were no experts’ opinions, thus the issue became a topic for political discussions. Even in developed countries pro-government political parties may oppose to bills and reject. In Armenia the parliament has a role of private ratification instrument, but this time it seems that it is breathing and showing signs of independence.

Going back to the bill, the authors of the bill say that it will cut down the shade and corruption and the PA does not want t adopt a bill, which will hit the large businesses. Those who are against the bill say that the goal of the bill is to flow more money to banks and for that reason they are against it. According to the bill, one of the goals is increasing the level of banking mediation, which will provide inflow through banks and develop the banking system. In addition, adopting a system of mandatory wire (bank) transfers between companies will give extra job to banks and enlarge the scope of services offered by banks. Those who are against the bill are not against this provision. For example, ARF representative Artsvik Minasyan says that they are not against the bill but they believe the bill contains certain risks. The problem is that the controller body may accuse companies in artificial division of one transaction in two parts (each of which with the value of 2 million drams). The MPs ask to explain how this limit was established and why 3 million. Minasyan says that it would be better if the state would control and establish the banking fee limits. On the other hand, if the state obligates to install ATM’s in shops, they would be better to sponsor a part of the expenses. Also, it is not understandable why exception has been made for banks and credit organizations. N fact the parliamentary opposition is not against the bill but is asking to make changes to it. For example, in order to make a transaction of a real estate property worth of 10 million, the parties cannot divide in several transactions to make it be lower than three million, which means that most of the real estate transactions will be processed through bank services. On the other hand, it will a little bit complicate the process of making transactions because one more step is added to this process. With this bill the government also intends to develop a culture of non-cash payments and transactions in the country. The goal is good, but in order to do this there must be trust not only in the private sector, but among the companies to the state too.