Dual Citizens Will Be Required to Pay Income Tax in Armenia: LHK Lawmaker on Universal Declaration

Armenian National Assembly member Arkadi Khachatryan from the Light Armenia (LHK) faction has highlighted the challenges posed by the universal income declaration law. He stated, "The implementation of the universal income declaration system, according to the Minister of Finance, implies that not only those residing in Armenia but all Armenian citizens must submit declarations regarding their incomes. This means that our hundreds of thousands of citizens who are dual citizens and live, for example, in Russia, as well as those who live in Armenia but work, for instance, in Russia, will be obliged to submit declarations and pay income tax in Armenia. If they have already paid taxes in Russia, they will then be required to pay the difference between our tax rate and theirs in Armenia."

To clarify, let's consider an example: a man goes to Russia for work, obtains Russian citizenship, and continues to live there, while maintaining his Armenian citizenship. The man is not officially registered as an employee; he works as a laborer and builds summer houses. Every month, he sends $200 to his mother in Armenia through remittances. According to the universal income declaration system, both the son and his mother will be required to submit declarations disclosing their incomes. The mother will not pay income tax on that income since gifts are not taxed, but the son will be responsible for paying 22% income tax for the year 2021 on his salary earned in Russia. If he has paid, for example, 13% tax in Russia, he would then have to pay 22-13=9% income tax in Armenia.

To remind, between 2017 and 2019, private remittances to Armenia amounted to approximately $1.7-2 billion annually. The introduction of this system in this manner could lead to a sense of injustice and significant dissatisfaction among our fellow citizens who have left their homes for work abroad while retaining Armenian citizenship. There is a risk that this could trigger a process of renouncing Armenian citizenship, which would be highly undesirable for our country. I urge the authorities to be very cautious in these matters and to only address the implementation of this system after a broad public discussion," Khachatryan has stated.