Aravot, Armenia
May 30 2009

A move to please people or actual concern?

The government decided not to check small and medium-sized businesses
for the next year and a half

Prime Minister Tigran Sargsyan has made a sensational announcement
while presenting the budget performance at the National Assembly
[parliament]: As per the Armenian president’s instruction, today we
are going to adopt an unprecedented decision (and the decision was
officially published in the second half of that same day) to support
small and medium-sized businesses’ development and create a favourable
environment for their taxation without administrative measures. Under
the government decision, all kinds of inspections are prohibited at
small and medium-sized enterprises between 2009 and 2010. We are sure
that stopping checks by 22 inspecting bodies in the crisis period will
create a better environment for the development of small and
medium-sized businesses. We are very well conscious that those
initiated measures are not enough to solve all pending problems and
we’ll continue our efforts in carrying out more anti-crisis measures.

Armen Martirosyan, head of the [opposition] Heritage faction, gave the
following assessment to the prime minister’s declaration: The prime
minister’s declaration once again confirmed the fact which the
Heritage party has been repeating numerous times, namely, the
government is stifling small and medium-sized enterprises. This is
even a belated step. This was supposed to have been done much earlier
when there was no political tension among the public. Currently,
perhaps, they (the government) do need to make populist steps. But in
our country large enterprises lead the economy. Whereas in normal
countries small and medium-sized enterprises are the driving force
because owing to them the middle class is created. The current tax
package is not yet advantageous for small and medium-sized businesses,
particularly, when the present political reality is added up to the
situation. The small and medium-sized businesses are constantly under
pressure because of numerous checks, fines and other reasons. Probably
only in a country like ours there is a special budget line of expected
fines. I think such absurd could not happen in any other country. And
small and medium-sized businesses are the main source of those fines
and not the large businesses. Taking the above-mentioned political
reality into account, we observe that large businesses make the bulk
of the economy. And despite this, it is not taxed and is not penalized
because it has political protection, whereas small and medium-sized
businesses do not have it. So proceeding from the above-stated, this
decision of the government is not a solution because the owners of
small and medium-sized businesses pay their taxes normally since they
have no political protection and keep their businesses going through
their fair work.

Yesterday the prime minister also explained to the few deputies
present in the almost empty session hall what the Russian loan of 500m
dollars would be spent on. A substantial amount would be allocated to
the construction of apartments in the earthquake zone. Armen
Martirosyan had reservations in this regard as well. First, there are
a lot of empty apartments in the earthquake zone. And the housing
problem can be solved by buying the empty apartments and giving them
to homeless people instead of constructing new ones. Second, I have
doubts regarding the organization which is going to be funded for this
purpose.

This organization is known to us since the times when the Yerevan city
centre construction started and we had numerous problems while they
had the super profit. We also remember that, and it was mentioned in
the budget as well, this construction almost was not taxed and it was
operating in the shadow. This is suspicious for me. An organization
that had super profit once now will get subsidy from the government
and again will not pay taxes. Taking all these into account, I see a
problem here. For the Heritage faction head the most important issue
is the following: We gave [Russia] property in exchange for the
100m-dollar debt, now we might give our country to get the 500m
dollars because it seems that we have nothing else. We have sold all
our energy resources to a non-Armenian company. None of the large
enterprises is the government’s property. The government possesses
only land and country if we may say so. So, are we going to yield our
country as a result of the deal?

To the newspaper’s question if this conclusion was not an
exaggeration, Mr Martirosyan replied with a proverb: Suffering is
experience.

From: Emil Lazarian | Ararat NewsPress