Armenia sees drop in tax collection rate because of coronavirus

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YEREVAN, June 13. /ARKA/. Due to the coronavirus pandemic, the tax collection rate has declined, according to Artur Hakobyan, deputy head of the Tax Audit Office at the State Revenue Committee.

He said at an online news conference today that the value added tax collection rate dropped by 16% in April and by 24% in May compared to the same months of 2019.

Hakobyan said the drop was caused by a lockdown imposed by the government to contain the spread of coronavirus.
He said there is hope that tax collection rate will begin improving after the government eased the lockdown in late April and in May.

According to him, the decline in the collection of income taxes is associated with the introduction of a flat income tax scale, which starts from 23%. Hakobyan said mass layoffs in March-April of the current year also seriously affected the amount of taxes received.

In his words, in March, 12,000 jobs were cut, while in April 74,000 employees had their income taxes annulled as part of the government measure to stimulate economic activity amid the ongoing a crisis. As a result, income tax collection rate in April dropped by 2.6 billion drams from March.

According to Hakobyan, the turnover tax collection rate recorded a decrease of 7%, although data for the second quarter will become known only in July.

A 30-day state of emergency to curb the spread of coronavirus was declared in Armenia on March 16 and restrictions were imposed on free movement of citizens. The government banned also some types of economic activity. On April 13, the government extended the state of emergency for another month and on May 4 it lifted the ban on almost all types of economic activity and the free movement of citizens, except for public transport. On May 14, the government has again extended the state of emergency for another 30 days.

However, despite the extension, public transport, preschools, trading centers, restaurants and gyms have reopened starting from May 18, and wearing of masks has become mandatory in public spaces.

Today, the government has extended the state of emergency for another month- until July 13. According to official data, the number of confirmed Covid-19 cases has risen to 15,281. The Ministry of Health said that the death toll has risen to 258. Health authorities also said that a total of 5,639 patients have recovered from the disease.

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