Turnover tax for SMEs in Armenia to be doubled

YEREVAN, May 2. /ARKA/. Turnover tax for small and medium businesses in Armenia is to be doubled, according to a set of. amendments to the Tax Code approved by the government today.

They will soon be submitted to the Parliament for consideration.

Thus, according to the proposed amendments, the tax rate for trade enterprises will be set at 10%, for production enterprises - 7%, and for the catering sector - 12%. At the same time, the limit for turnover tax will remain unchanged at 120 million drams per year (equivalent to about $300 thousand), and if the business exceeds this threshold, it will be forced to switch to VAT and profit tax.

Presenting the draft at the government session, Finance Minister Vahe Hovhannisyan emphasized that the issue of increasing the turnover tax has been discussed for several months. According to him, this tax has ceased to be a tool for business development.

As a result of the innovations, retailers will be able to reduce their minimum tax rate from 1.5% to 1%, manufacturing companies from 3.5% to 3%, and the catering sector from 4% to 3.5%.

Also within the framework of the reforms it is proposed to exclude notaries, lawyers, and lottery organizers from the turnover tax sphere from January 1, 2025 - they will be transferred to the general tax field.

 It is proposed to exclude from microbusinesses area trade outlets, as well as hairdressers, saunas, and car repair shops in the regions. The latter will be able to either pay turnover tax or VAT and profit tax.-0-