Taxation in Armenia is regulated by the State Revenue Committee, which is the

tax A tax is a compulsory financial charge or some other type of levy imposed on a taxpayer (an individual or legal entity) by a governmental organization in order to fund government spending and various public expenditures (regional, local, or n ...

authority of the

Armenian government The politics of Armenia take place in the framework of the parliamentary representative democratic republic of Armenia, whereby the President of Armenia is the head of state and the Prime Minister of Armenia the head of government, and of a mul ...

. Meanwhile, the Armenian Tax Service is responsible for the collection of taxes, providing

revenue service A revenue service, revenue agency or taxation authority is a government agency responsible for the intake of government revenue, including taxes and sometimes non-tax revenue. Depending on the jurisdiction, revenue services may be charged with ...

s, preventing tax fraud and

tax evasion Tax evasion is an illegal attempt to defeat the imposition of taxes by individuals, corporations, trusts, and others. Tax evasion often entails the deliberate misrepresentation of the taxpayer's affairs to the tax authorities to reduce the tax ...

, and implementing various tax reform programs in conjunction with the State Revenue Committee.https://www.petekamutner.am/Content.aspx?itn=tsATSMission

Type of tax

Employee income tax

From 1 January 2020,

Armenia Armenia (), , group=pron officially the Republic of Armenia,, is a landlocked country in the Armenian Highlands of Western Asia.The UNbr>classification of world regions places Armenia in Western Asia; the CIA World Factbook , , and ' ...

switched to a flat

income tax An income tax is a tax imposed on individuals or entities (taxpayers) in respect of the income or profits earned by them (commonly called taxable income). Income tax generally is computed as the product of a tax rate times the taxable income. Tax ...

ation system, which, regardless of the amount, will tax wages at 23%. Moreover, until 2023 the taxation rate will gradually decrease from 23% to 20%.

Corporate income tax

Reforms adopted in June 2019, aims to boost medium-term economic activity and to increase tax compliance. Among other measures, the

corporate income tax A corporate tax, also called corporation tax or company tax, is a direct tax imposed on the income or capital of corporations or analogous legal entities. Many countries impose such taxes at the national level, and a similar tax may be imposed at ...

was reduced by two percentage points to 18.0 per cent and the tax on dividends for non-resident organizations halved to 5.0 per cent.

Special taxation for small business

From 1 January 2020, Armenia abandoned two alternative tax systems - self-employed and family entrepreneurship. They have been replaced by micro-entrepreneurship with a non-taxable threshold of up to 24 million drams. Business entities that carry out specialized activities, in particular, accounting, advocacy, and consulting will not be considered as micro-business entities. Micro business are exempted from all types of taxes other than income tax, which will be 5 thousand drams per employee.

Value-added tax

Over half of tax revenues collected between the January–August 2008 time period were generated from

value-added tax A value-added tax (VAT), known in some countries as a goods and services tax (GST), is a type of tax that is assessed incrementally. It is levied on the price of a product or service at each stage of production, distribution, or sale to the en ...

es (VAT) of 20%. By comparison, corporate profit tax generated less than 16 percent of the revenues."Government Keeps Up Strong Growth In Tax Revenues"
Armenia Liberty (

RFE/RL Radio Free Europe/Radio Liberty (RFE/RL) is a United States government funded organization that broadcasts and reports news, information, and analysis to countries in Eastern Europe, Central Asia, Caucasus, and the Middle East where it says tha ...

), October 14, 2008. This suggests that tax collection in Armenia is improving at the expense of ordinary citizens, rather than wealthy citizens (who have been the main beneficiaries of Armenia's double-digit economic growth in recent years).

References

{{Armenia topics Tax International taxation