The State revenue Committee informs that as an inevitable result of the amendments made by Law No. HO-331-N adopted on October 25, 2023, the grounds for termination of tax obligations have been changed, among other grounds for termination , it is planned that:
The tax obligations of individual entrepreneurs and natural persons who are not notaries cease if 5 years have passed since the deadline for the fulfillment of tax obligations not exceeding two million drams, set by the Tax Code and RA laws on fees,
tax obligations of an organization or an individual entrepreneur or a notary cease if 7 years have passed since the deadline for the fulfillment of tax obligations not exceeding two million drams, set by the Code and RA laws on fees.
The committee informs that due to the changes, the tax authority will initiate the process of termination of tax obligations on the above grounds.
What are the main implications of law No. HO-331-N for individuals and small businesses in Armenia?
Interview with Tax Expert Dr. Anahit Martirosyan on Recent Amendments to Tax Obligations in Armenia
Editor of Time.news: Thank you for joining us today, Dr. Martirosyan. The recent amendments brought about by Law no. HO-331-N have crucial implications for individuals and organizations regarding tax obligations. Can you please summarize the key changes?
Dr. Anahit martirosyan: Thank you for having me. Certainly! The recent law modifies the grounds for the termination of tax obligations considerably. For individual entrepreneurs and natural persons who are not attorneys,their tax obligations will cease after five years if the amount due does not exceed two million drams. for organizations, individual entrepreneurs, and notaries, this period extends to seven years under similar conditions.
Editor: That’s quite a meaningful change. What do you think prompted the State Revenue Committee to implement these amendments?
Dr. Martirosyan: The amendments seem to reflect an effort to streamline tax administration and perhaps relieve some taxpayers from undue financial burdens.By setting these time limits, the authorities may be aiming to clear historical debts that are relatively small and possibly uncollectible, thus allowing taxpayers to move forward without lingering obligations.
Editor: How do these changes impact individual entrepreneurs and small businesses in Armenia?
Dr. Martirosyan: Individuals and small business owners now have a clearer pathway to resolving older tax issues. for those with outstanding debts under two million drams, the potential for debt relief after five years may encourage compliance and foster a more positive relationship with the tax authority. This could ultimately boost economic activity as entrepreneurs might feel more secure in making business decisions without the cloud of old tax debt looming over them.
editor: Are there specific industries or sectors that you believe will benefit most from these changes?
Dr. Martirosyan: Yes, I believe that small-scale enterprises in sectors such as retail, food services, and other service industries will feel the most immediate impact. Many of these businesses operate on slim margins and can find themselves with minor tax liabilities that have accrued over the years. This law could provide them with a fresh start, allowing them to reinvest in their businesses rather than being hindered by past obligations.
Editor: What practical advice can you offer to those who may be uncertain about how these changes affect their tax situation?
Dr. Martirosyan: I recommend that individuals and business owners familiarize themselves with the specifics of these amendments. it would be wise to consult with a tax professional who can help them assess their current obligations and determine their eligibility for relief under the new law. Keeping accurate records and maintaining open communication with the tax authority will also be key in navigating this transitional period.
Editor: Looking ahead,how do you think these changes will influence taxpayer behavior and compliance with tax obligations?
Dr. Martirosyan: I believe we might see an increase in compliance as taxpayers gain a better understanding of their rights and obligations under the new law. With clearer guidelines for termination of debts, individuals and business owners may be more inclined to resolve their tax issues proactively rather than avoiding the tax authority. This could lead to a more robust revenue stream for the government in the long term.
Editor: Thank you, Dr. Martirosyan, for sharing your insights on these crucial changes.Your expertise is invaluable for our readers navigating the complexities of tax obligations.
Dr. Anahit Martirosyan: Thank you for having me. It’s important that taxpayers remain informed so they can make the best decisions for their financial well-being.