27
05, 2011

President Serzh Sargsyan held a working meeting with the leadership of the RA State Revenue Committee

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Today, President Serzh Sargsyan held a working meeting with the leadership of the RA State Revenue Committee.

The Chairman of the Committee Gagik Khatchatrian, his Deputies and Heads of Departments presented to the President of Armenia main problems of the SRC and proposals aimed at their resolution. They also spoke about the process of implementation of the assignments given by President Sargsyan during previous meetings and aimed at the improvement of tax and customs administration. In particular, discussed were the current stage of electronic governance in the Committee and the problems of the structure, works implemented in accordance with the time table emanating from the reformation programs, analysis of statistical data and their application during the customs monitoring, works aimed at the improvement of border administration, tax collection for the four months of 2011 and a number of other issues.

“Mr. President, you have assigned us with an important task to significantly improve tax and customs administration, to turn the structure into the one which provides exceptional services, to create equal and competitive conditions for the businesses and provide for the tax collection without impairing businesses. I would like to present to you what we have done so far: in 2010 and 2011, as well as before, in our activities we took all these issues into account. They are diverse and we have accomplished a considerable amount of work. We have essentially reduced the document flow for the tax payers. We have altered the return compiling system, making it simpler, reducing number of returns for the businesses and creating more manageable situation. We have also established the system of e-governance for the businesses and solved the problem of added value tax by turning to an automated system. We have forestalled the former malicious practices of overpayments and have introduced in the Republic the system of the “one window” approach for the development and registration of businesses. The optimization of the structure of the tax collecting bodies is very important for us since it will promote a better monitoring of the work. Along with these steps, many changes have also been made in the legislation which also helped the process. They mainly concern financial reports. We have reduced a number of tax reports which were unnecessary. A general fixed deadline of three months has been established for all returns instead of one month period or even varied days in the course of one month,” Gagik Khatchatrian, Head of the State Revenue Committee, informed the President at the beginning of the meeting.

In his speech addressed to the leadership of the SRC, President Serzh Sargsyan underscored that the objective is clear: first, the perception regarding the tax and customs bodies in the society and in the business circles should be changed from the one which collects taxes into the one which services the taxpayers, bodies which provide services in time and conduct monitoring.

“In order to accomplish all this, you should not only change the entire logic of work in your establishment but also change the motivation and behavior of the businessmen. We will do that in the atmosphere of cooperation and dialogue, creating a clear, transparent and efficient structure, improving the quality of the provided services and offering new working conditions. At the same time, we must be steadfast in our activities aimed at the reduction of grey economy, decreasing corruption risks in the tax and customs systems and, most importantly, by providing equal treatment and fair attitude to all businesses. This is probably the most important problem that we must solve. And the program, which we have approved at the National Security Council, implies solution of these very problems,” said the President of Armenia.


President Serzh Sargsyan’s remarks at the working meeting with staff of the State Revenue Committee


I have initiated a meeting in this format so that we can recap together where we stand in our works aimed at the changes in the works of the State Revenue Committee, what our next steps will be, what are the problems to be solved at this stage to accelerate the process of reformation.

After adopting the program of reformation of the tax and customs structures for the coming three years at the sitting of the National Security Council, the SRC was tasked to develop a detailed program and a precise time-table of the actions. Since that program has not been summarized yet, I propose to review today the main directions of the program, discuss current opportunities for their implementation and required resources.

I emphasize the issue of resources since both at the sitting of the National Security Council and in general lately we have been going through radical changes and we believe that in this area too in order to anticipate serious results, we should make significant investments.

At the same time, I propose to discuss the process of budget entries and possible developments to understand the impact of the reforms on the process of tax collection. The problem you face is really a tough one; you should be able not only to reduce as much as possible the administrative burden for our businesses through the swift reforms but also simultaneously ensure a proper tax collection. Moreover, we should be able to increase year by year the taxes/GDP ratio, bringing into field of taxation as many segments from the grey economy as possible. And I believe it is beyond doubt that grey economy sector does exist and, unfortunately, we cannot determine now large it is. There can be some contradictions in the implementation of these two major tasks, however you should be able to perform them simultaneously. I would like to repeat that on one hand you should lessen the administrative burden by improving it, making it more acceptable for our businesses, and on the other hand to increase the taxes/GDP ratio, i.e. to collect more taxes. We have no alternative on this issue. The system must be able to constantly increase the tax collection and at the same time become more acceptable, fair, equal, uncomplicated and friendly for the businesses. It is a difficult task indeed, very difficult, but I have no doubt that it is doable.

To achieve that I am personally ready to assist you in your efforts and, as you know, our recent meeting with the major businesses have been conducted toward that very end. We want to create a new atmosphere of cooperation and, of course, we will continue to hold such meetings.

Finally, we should be able to change the attitude toward the SRC, we should be able to change attitude toward the tax and customs administration bodies. It is a major task for us, and we must solve it. At the same time, we should change demands presented to the SRC; it is also incontestable. Our goal is clear-cut: the perception regarding the tax and customs bodies in the society and in the business circles should be changed from the one which collects taxes into the one which services the taxpayers, bodies which provide services in time and conduct monitoring. In order to accomplish all this, you should not only change the entire logic of work in your establishment but also the motivation and behavior of the businessmen. We will do that in the atmosphere of cooperation and dialogue, creating a clear, transparent and efficient structure, improving the quality of the provided services and offering new working conditions. At the same time, we must be steadfast in our activities aimed at the reduction of grey economy, decreasing corruption risks in the tax and customs systems and, most importantly, by providing equal treatment and fair attitude to all businesses. This is probably the most important problem that we must solve. And the program, which we have approved at the National Security Council, implies solution of these very problems.

Now I am ready to listen to your proposals, observations and, certainly, information regarding the process of implementation of these steps.”

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