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Government Moves To Write Off Tax Debts

Sargis Harutyunyan 23.02.2012

Armenians who failed to pay land and property taxes from 1996 through 2007 will have their debts completely written off, according to a bill approved by the government on Thursday.

The bill drafted by several parliament deputies from the ruling Republican Party of Armenia (HHK) would also introduce a partial tax amnesty for such debts incurred in 2008-2010. Individuals clearing their tax liabilities for that period would be exempt from financial penalties envisaged by Armenian law.

Prime Minister Tigran Sarkisian estimated the total amount of the debts which the government would be able to forgive at around 43 billion drams ($110 million). The unpaid land and property taxes for 1996-2007 account for almost 70 percent of the figure, Vache Terterian, a deputy minister for local government, said, presenting the bill at a weekly session of Sarkisian’s cabinet.

Neither official specified how many people would be affected by the measure that is likely to be approved by the Armenian parliament. Sarkisian said only that village residents who own agricultural land will be its main beneficiaries.

“This is an extremely important legislative initiative by the Republican Party’s parliamentary faction,” Sarkisian told ministers. “Our villagers constantly raised this issue during our visits to the regions.”

“The tax burden on agriculture will considerably ease as a result,” he added.

Opposition politicians and other government critics will link the tax amnesty to the approaching parliamentary elections which the HHK plans to win by landslide.

The government already faced such claims in the press after it unveiled a 18 billion-dram benefits package for tens of thousands of public-sector employees in November. Starting from this year, the government will pay for their and their family members’ medical insurance, education and recreation as well as subsidize mortgage loans borrowed from commercial banks.

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