V. Safaryan: Shadow economy is formed by big business

Turnover tax of small and medium businesses makes only 2-2.5% of state budget revenues, Chairman of the Union of Armenian Domestic Commodity Producers Vazgen Safaryan told reporters today. In his words, it is unrealistic to say that this percentage is of significance to the budget. Safaryan noted that the state should support small and medium businesses.

According to him, the shadow economy is formed not by SMEs, but by big businessmen, in particular by importers, and the best way to fight this phenomenon is to implement a correct customs policy.

The union chairman proposed providing an opportunity of free choice to small and medium traders. Besides, many small and medium businessmen buy goods on an installment plan, without prepayment, and pay only after their sale, which will create difficulties in case of the new law, he said.

“Additional accounting and document circulation will create difficulties for small and medium businessmen. Many of them lack enough education and experience so prove the volume of their turnover to tax inspectors so the new law raises serious concern,” he said.

V. Safaryan stressed that the government is currently unable to create jobs so it should not create obstacles for those people who have a job.

“It is necessary to promote the industrial policy in Armenia. If we managed to retain the Soviet-era industry, the government wouldn’t now strive after taxes of small and medium businesses,” Safaryan said.