WITH A CHANGED MODEL OF YEREVAN’S GOVERNANCE, REVENUES OF THE CITY BUDGET WILL INCREASE, VATCHE TERTERIAN SAYS
Noyan Tapan
Dec 11, 2008
YEREVAN, DECEMBER 11, NOYAN TAPAN. The bill on local self-government
and territorial administration in Yerevan will be soon submitted to
the RA National Assembly for discussion in the second reading. By the
bill, Yerevan will have a budget envisaged for implementation of the
city development program. Decisions on the budget to be submitted by
Yerevan mayor and decision on changes in it will be made by the council
of aldermen. "It is obvious that the measures on solution of all-city
problems in Yerevan can be efficiently managed only from one center,
while their financing can be carried out from a united budget formed
with this aim," the Head of the Budget Process Management Department
of the Staff of the RA Ministry of Finance David Hambartsumian said
at the December 11 enlarged hearing of the bill at the parliament.
Accoridng to him, the budget of Yerevan will form from the same sources
of revenues as the budgets of the current district communities. The
deficit will be financed with funds borrowed in order envisaged
by law, the balance of Yerevan budget’s resources available at the
beginning of a year, funds received from repayment of budgetary loans,
as well as resources received from the privatization of state share
in authorized capital of legal entities and from the sale of real
estate representing state property.
D. Hambartsumian said that several considerations on ensuring some
conditions in the revenues of the budget were taken into account:
in particular, "the revenues must be efficient, that is, they must
ensure more stable and regular revenues, ensure enough incomes to
cover considerable part of the expenditures of a community, they
must be neutral, that is, as independent as possible of private
economic decisions and the direct impact of economic changes in the
country, they must be simple and understandable for communities from
the administrative point of view, while the revenues received must
be predictable and fair, that is, the tax burden must be equally
distributed on all taxpayers within a community".
In response to NT correspondent’s question, the co-author of the
bill, the First Deputy Minister of Territorial Administration Vatche
Terterian said that the budget of Yerevan will not be "a mechanical
sum of the budgets of the current district communities but it will
be greater". In his opionion, only as a result of the improvement
of administration, revenues will grow by at least 20-30%. Besides,
it is expected that with a changed model of Yerevan’s governance, the
amounts of target subsidies to be allocated from the state budget will
increase in the revenues of the city budget because, according to him,
"we will have politically elected mayor and council of aldermen who
will deal much more seriously with the issue of attitude of the state
to Yerevan than the current mayor who is an official appointed by the
government". V. Terterian also said that some taxes, which are not
compulsory for communities and will be used on a voluntary basis,
will be establshed soon, for example, hotel tax used in many big
European cities, which may also help increase budgetary revenues.