Several hundred small and medium sized business owners staged a protest in front of the government building on January 30. They were demanding that Prime Minister Hovik Abrahamyan suspend the new law on turnover tax that is set to go into effect on February 1.
This was not the first protest by business owners, who are opposed to the new legislation, which they say places an added burden upon them and will force many out of business.
During the protest, a number of representatives from the business community met with the Prime Minister to communicate their grievances personally. While the discussions were taking place inside the government building, one of the participants of the demonstration declared that they were going to stage an around-the-clock sit-in. Some of the protesters joined.
Members of Parliament Mikael Melkumyan, Vahan Babayan and Vahe Enfiajyan from the Prosperous Armenia Party parliamentary faction joined the protesting business owners. Melkumyan said that the issue of the turnover tax would be presented during a meeting with representatives from the three opposition parties — Prosperous Armenia Party, Armenian National Congress and the Heritage Party and on February 2, they would submit a request for a special session of parliament to discuss the controversial legislation.
Following the meeting with the Prime Minister, the representatives of the protesters said that they had come to an agreement that they would give the prime minister until February 2, 16:00 to revisit the issue and to reassess the law. At the same time, the Prime Minister will allow those business owners who prefer to pay the current 3.5 percent turnover tax to do so voluntarily, and those who are willing to pay the 1 percent tax, and by doing so fill out all the documents as required under the new law, to do that. They were also able to come to an understanding with the prime minister, that those business owners engaged in the gold market, appoint a group of representatives to meet separately with the prime minister.
This was not the first time that business owners were protesting the new legislation. Similar demonstrations against the government’s decision to revamp the turnover tax took place on January 26, 27 and 29 in Yerevan.
Background
The new law “About Turnover Tax” foresees reducing the percentage rate for turnover tax for small and medium-sized businesses from 3.5 to 1 percent but it would also require cumbersome documentation to be filled out by the businesses. Many say that it would force them to hire a full-time accountant to fill out all the necessary paperwork.
The law, which Prime Minister Hovik Abrahamyan insists is targeted toward large taxpayers, had to come into effect on October 1, 2014. However, this new law was met with opposition by small and medium sized business owners who organized a number of protests in front of the government and National Assembly. As a result of those protests, the date of implementation for the new tax was pushed back to February 2, 2015.
