Support Program for Value Added Tax Payers Approved

The Armenian government has established a transitional period for value added tax (VAT) payers engaged in buying and selling. This decision was made during a government meeting.

Finance Minister Vahe Hovhannisyan noted that in response to numerous complaints from entrepreneurs, the government has decided to implement a support program. He elaborated that support pertains to those businesses that, as of January 1, 2025, have significant inventory acquired previously, for which they either lack supporting documents or possess documents but where the VAT rate has been decreased only by 4% – from the current 9.5%.

“The transitional period we have defined will encompass the first six months of 2025, until July 1. During this time, the government will assist VAT-paying enterprises in realizing their previously acquired inventory without documents within the limits of a lower tax burden,” emphasized Hovhannisyan.

It is important to note that starting in 2025, the VAT for small businesses has increased significantly: from 5% to 10% in the trade sector, from 3.5% to 7% in the manufacturing sector, and from 6% to 12% in the public catering sector. Businesses can reduce this tax if they maintain clean accounting. In this case, merchants can lower the tax to as low as 1%, manufacturing entities to 3%, and public catering establishments to 6%.