Traders and owners of other small businesses have long paid a single tax equivalent to just 5 percent of their annual turnover. A new law that took effect on January 1 raised the tax rate to 10 percent.
The government made last week what it portrayed as a major concession after weeks of protests staged in Yerevan by hundreds of people selling clothing, jewelry items and other products in small shops and markets. It said they can get back the extra taxes to be paid by them in the first half of this year if they apply for the rebate electronically.
The more than 100 protesters who again gathered outside Prime Minister Nikol Pashinian’s office dismissed the concession, insisting that the government repeal the tax hike altogether. They claimed that it is designed to trick them into ending their campaign. Some of them also complained that they cannot do the paperwork required for qualifying for the six-month reprieve.
“They have deceived us,” one middle-aged man told RFE/RL’s Armenian Service.
“I don’t believe a single word he says,” another, female protester said, referring to Pashinian. “He says one thing but one or two months later claims, ‘Did I say such a thing?’”
Economy Minister Gevorg Papoyan received the protesters later in the afternoon. They were unconvinced by his pledges to address their concerns.
Meanwhile, in Gyumri, people involved in similar entrepreneurial activities went on a one-day strike for the same reason. Their representatives met with Davit Arushanian, the governor of the surrounding Shirak province. Arushanian only promised to have officials from Yerevan visit Gyumri and hear their demands.
The main official rationale for the tax hike is to create a level playing field for all businesses and reduce tax evasion. The affected traders counter that they already have trouble competing with larger stores and shopping malls as well as rapidly growing online retailers.