Gas Station Managers Dissatisfied with New Law

Starting May 1, compressed natural gas at gas stations in Armenia will be sold not by cubic meters, but by kilograms. This was confirmed yesterday when the Armenian parliament adopted in the second reading, and in full, the bill proposed by the executive to amend the Tax Code.

The essence of the regulation defined by the law is the change in the measurement unit that accounts for the volumes of compressed natural gas for the purpose of excise duty taxation. It is noteworthy that 107 deputies voted in favor of the bill, with no votes against or abstentions. Furthermore, the law will come into effect starting from the first of the month following the official publication date, meaning compressed natural gas will be sold by kilograms at gas stations starting May 1.

Mkrtych Tigranyan, the head of the “Expert Tech” company, stated in an interview with the “Zhoghovurd” newspaper that while the equipment for selling compressed gas by kilograms does not incur additional costs for gas station owners, the tax burden is increasing.

It should be noted that the calculated amount corresponding to the excise tax rate for 1 ton of compressed natural gas will be approximately 34,867 drams. The proposed bill suggests setting the rate slightly lower, at 34,000 drams per ton.

“Economic calculations are getting quite complex with the relations of ‘Gazprom Armenia’ and the State Revenue Committee (SRC), as they will receive gas in cubic meters but sell it by kilograms. How they will calculate this is still up in the air. This calculation process is complicating and can be said to become uncontrollable. After all, the density of gas varies; it’s not constant and can change at different times of the day depending on the weather,” he explained.

In such cases, the SRC views these matters differently and does not delve into the details and nuances. “Well, good luck proving that I received it in cubic meters but sold it by kilograms,” the expert candidly remarked, adding that it is currently impossible to predict whether prices will rise or not. It is also important to note that during the last government meeting, Prime Minister Nikol Pashinyan clearly stated, “The government has not made any decisions that would have an impact on the gas station market, and all talks of price increases are manipulations.” Furthermore, he warned that “certain former oligarchs, if they think they can engage in manipulations in this situation, are mistaken.”

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