Macroeconomy

 

January-November collected taxes grow 11,5% totalling 1 trillion 163 billion AMD
/Dec 21/Panorama/     

YEREVAN – 1 trillion 163 billion drams in tax revenue has been collected in January-November 2018, a 11,5% growth against 2017’s indicator, the State Revenue Committee (SRC) said in its 11-months budget performance report of the current year.

According to the 2018 state budget, 1 trillion 248 billion in taxes and duties was envisaged to be collected during the entire year, and as of November 93% of the plan has already been implemented.

The total revenues are composed the following way: 47% VAT (2,8% growth), revenue tax – 30,7% (2,1% growth), 0,9% profit tax (4,3% decline) and excise tax – 11,4% (2,2% growth).
 

Yerevan Council of Elders raises local duties
/Dec 25/ARKA/

YEREVAN – Members of the Yerevan City Council of Elders from the Prosperous Armenia Party and Luys bloc voted today against a decision that increases a string of local duties from 2019.
They argued that the decision would not only cause a serious blow to small and medium-sized businesses, but also prompt price hikes. However, the decision was backed by My Step bloc that holds the majority of seats in the capital’s legislative assembly.
According to the decision, the local duty on the construction of buildings and structures will increase by 40% – by 6,000 drams for structures up to 20 square meters and by 10,000 drams for structures 20 and more square meters. In 2018, these duties were respectively 15 thousand and 25 thousand drams.
Local duty on the sale of liquid fuels, compressed natural or liquefied petroleum gas will increase by 250 thousand drams to 600 thousand drams (an increase of 71.43%). 
Local duties for administrative, commercial, public facilities, entertainment and gambling, as well as casinos, bathhouses and saunas operating after midnight will also rise. In particular, duties on commercial facilities will grow by 37% or 32.5 thousand drams, on catering and entertainment facilities – by 75 thousand drams or 48%, and on baths and saunas – by 525 thousand drams or 60%.
Yerevan mayor Hayk Marutyan said the changes in fact are minor and will not be felt as a whole. He promised that on January 15, an extraordinary meeting of the Council of Elders is likely to set a set of benefits for small and medium businesses.


Prices for apartments have increased in Yerevan and marzes in November 2018
/Dec 25/Lragir/

The average market prices for apartments in multi-apartment buildings with 1m² surface calculation have increased by 0.3 % in November in comparison with October, while by 11.1% in comparison with November 2017 in Yerevan. The average market prices for apartments in multi-apartment buildings with 1m² surface calculation have increased by 0.2% in November 2018 in comparison with October 2018 in the cities of marzes in Armenia.

(Information and Public Relations Unit of the Real Estate Cadastre Committee of the Republic of Armenia)
 

New limitations for duty-free personal use imports through NON-AIR transport
/Dec 24/ArmenPress.am/

YEREVAN – The cost and weight volume of imported products that are not subject to customs duties and taxes will be cut three and two times respectively, the SRC said. The changes will come into effect from January 1, 2019.

The amendments are in pursuance of a regulation of the Eurasian Economic Commission.

The State Revenue Committee of Armenia issued a notification in a press release to natural entities that in the event of importing products of personal use worth under 500 Euros up to 25 kg in weight no duties will be charged. A single duty rate will be applied in the event of exceeding the duty-free limit – 30% of the product value, but not less than 4 Euros for 1 kg.

The regulations concern products in luggage imported into the EEU territory (excluding air transport).

The new rates do not cover alcoholic drinks, Ethyl alcohol, beer, and non-distributable personal use products.
 

SMEs in Yerevan to be exempt from local duty increases, vows Mayor
/Dec 25/ArmenPress.am/

YEREVAN – SMEs with up to 58,3 million drams in annual turnover will be exempt from the tax increased that are part of a Yerevan City Council bill on 2019 local duty rates, Mayor Hayk Marutyan said at a sitting today.

He added that the City Council will convene a special sitting sometime mid January for additional discussions over the matter. “You know very well that several duties under this draft are being increased in Yerevan, but because our policy is to support small and medium businesses, I am recommending to hold a session and define exceptions,” he said.

The Mayor said the decision will come into force January 1, thus urged operators not to worry.

Changes include a 6000 dram increase in the license duty for construction of up to 20 sq.m. buildings, and a 10,000 dram increase in the license duty for non-main buildings in greater space.

The license for selling liquid fuel, pressurized natural and liquefied petroleum gas for a fiscal year is increased from 350 thousand to 600 thousand drams.

Local duties for entertainment facilities operating after midnight have also changed, among others.
 

New investment project worth $450,000,000 to be implemented at Alliance FEZ in Armenia
/Dec 27/ArmenPress.am/

YEREVAN – The government has granted HRANT ENERGY a license to operate at the Alliance Free Economic Zone.

The company plans to establish a hydrogen turbo-generator equipment production.

Exports volumes are envisaged to reach an annual of 300,000,000 dollars, with Russia being the main direction.

Nearly 450,000,000 dollars will be invested in the project.

The number of new jobs during the entire period of the project will reach 1000.
 

Armenia’s Public Debt to Rise Further In 2019
/Dec 26/RFE/RL Armenian Report/By Sargis Harutyunyan/

Armenia’s public debt is projected to rise to about $7.5 billion next year as a result of more borrowing planned by its government, a senior official from the Finance Ministry said on Wednesday.

According to ministry data, the government and the Central Bank of Armenia owed a total of $6.77 billion to mainly foreign creditors as of November 30. Finance Minister Atom Janjughazian said earlier that their combined debt will reach $7.1 billion before the end of this year. The figure would be equivalent to round 55 percent of Gross Domestic Product.

 “If all projections made by us … materialize the state debt will make up

approximately $7.5 billion at the end of 2019,” said Arshaluys Markarian, the head of a Finance Ministry department on public debt management. “Just over $6.9 billion of that will be the government’s debt.”

Markarian told RFE/RL’s Armenian service (Azatutyun.am) that the government

plans to obtain about $490 million in fresh loans in 2019.

The Armenian state budget for next year sets aside $735 million for debt

servicing. The sum will account for over one-fifth of the government’s overall budgetary expenditures.

In Markarian’s words, debt repayments will peak at $800 million in 2020 mainly because of Eurobonds issued by the former Armenian government in 2013. They are projected to fall in the following years but rise again to $730 million in 2025, he said.

 “I wouldn’t advise anyone to get fixated on these figures and be worried about them because if Armenia is already in the international financial markets it will have a constant presence there,” added the official.

Janjughazian similarly downplayed the rising public debt at an October 4 news conference in Yerevan. The finance minister argued that it will fall as a share of GDP in 2019.

The debt rose by $863.5 million in 2016 and by another $832.5 million in 2017. It totaled just $1.9 billion before the 2008-2009 global financial crisis that plunged the county into a severe recession.
 

Armenia’s Public Debt Is 6,765,500,000USD
/Dec 28/Lragir/

The public debt of Armenia as of November 30 is 6,765,500,000USD or3,281,876,400,000 AMD. The foreign debt as of the end of November was 5,395,794,000 USD, of which 4,825,098,000 is the debt of the government.

As of the end of 2017 the foreign debt of Armenia has decreased by 99.108 million dollars. In December 2017 the foreign debt of Armenia was 5,494,902,000 dollars.

Compared with October, however, in November the foreign debt increased by 8.551 million dollars.
 

Economist: Armenia spends 94.1 billion drams in state procurement in first half-year
/Dec 28/Panorama/

Armenia has spent around 94.1 billion drams in state procurement in the first half of 2018, against the 70,8 billion drams spent in the same period last year, an advisor to Armenian’s acting PM, economist Artak Manukyan said on Friday, summing up the key tendencies in the system in the indicated period.

Manukyan, who also heads the National Center of Public Policy Research NGO, says some 74,000 procurement processes are set for one year, 9,800 of which are not carried out due to various reasons. Thus, over 13% of the procurement plans were not realized this year.

“To compare, 1.6% of the planned procurement procedures did not take place in the first half of 2017 due to various reasons, particularly due to a lack in participation, which points to a low interest in the procurement system,” the economist said.

According to him, procurement via tendering is the most preferable type, which, however, has 4% share in the sphere. “This points to the fact that the system is not really attractive if purchases are not carried out on the basis of open procedures. Amid a lack of a more transparent procurement opportunity, the corruption risks grow,” he added.

Manukyan next said amendments have been made to some laws regulating the purchase processes involving small, medium-sized businesses and small startups, with a draft law proposing not to demand any documents in case of procurements totalling 10 million drams put into circulation.

The next legal reforms cover the participation in procurement processes in Armenia and the EAEU zone, proposing to allow ‘blacklisted’ people to take part in them.

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