Thursday, 28 September 2017
Government approves Armenia’s 2018 budget bill: the revenue side is more than 100 billion drams up
A Cabinet sitting was held today, chaired by Prime Minister Karen Karapetyan. Prior to the discussion of the agenda issues, the Prime Minister issued a number of instructions aimed at simplifying the procedures and expanding the range of online services for non-cash payments, cleaning water flows leading to reservoirs, and adopting new approaches to the elderly care policies.
The Executive approved the draft State budget law for 2018. The Minister of Finance of the Republic of Armenia was instructed to make amendments and submit to the Government Staff, which in turn will forward the bill’s finalized version to the RA National Assembly in the prescribed manner.
Minister of Finance Vardan Aramyan noted that the next year’s budget will have 1 trillion 307 billion drams in revenue against the 1 trillion 207 billion envisaged in 2017, with the difference of AMD100 billion coming from additional tax receipts. The expenditure side is 1 trillion 464 billion drams, the deficit - about 157 billion drams.
“Taking into account the forecasts, we have raised the growth index. We had originally envisaged 3.2% growth for 2017, but given the high economic activity, we expect that this year’s economic growth will be between 4-4.8%. In view of the above, we have raised the growth index up to 4.3%. For the next year we forecast 4.5% economic growth,” the Minister said.
The Minister of Finance underlined that capital and defense expenditures have been raised in 2018. Touching upon the media-circulated news about would-be cutbacks, Vardan Aramyan said that the Government had not discussed such a possibility.
“There is nothing like that at all. We have a very clear ideology, which was fixed in the 2017 budget bill, and we will abide by the same behavior in 2018. By the way, international organizations, including rating agencies, have maintained Armenia’s ratings against the background of increased indebtedness and expressed high opinion of the Government’s budgetary policy in 2017, as well as the medium-term expenditure program as approved in the month of July,” the Minister of Finance emphasized, adding that the Government had managed to demonstrate conservative behavior in terms of recurrent expenditures.
The meeting approved a number of legislative initiatives undertaken by the Government. In particular, the Cabinet endorsed the Government’s legislative initiative on the draft law on normative legal acts. The bill covers not only the constitutional amendments, but also the conceptual new institutions and the new legal regulations resulting therefrom.
Another amendment was passed concerning the law “On amending the RA Law on Free Economic Zones” in a bid to set clear-cut statutory guidelines for the creation, organization, exploitation and liquidation of free economic zones in the Republic of Armenia.
The amendment clarifies the powers of the Authorized Body, the obligations of the Organizer and Operator, the relationship arising from FEZ operations, the requirements applicable at the borderline area of free economic zones, the procedures for liquidating free economic zones, etc.
The Government’s legislative initiative on the bill “On amending the RA Law on Foreign Investments” is aimed at improving the legislative and regulatory framework regulating the investment sector by addressing various issues of attracting, promoting and protecting foreign investments.
At the same time, new guarantees of investor protection are fixed and a new dispute resolution mechanism is defined. The draft introduces more favorable national regimes, as well as the principle of fair and equal treatment and minimum investment protection standards. There is also an opportunity to use alternative means (arbitration) to resolve disputes with the State.
The Executive accepted the proposal to sign an agreement on “Promoting and Encouraging Investments between the Government of the Republic of Armenia and the Government of India.” The draft provides for favorable conditions for investors on the basis of equality and mutual benefit, contributing to the promotion of business initiatives in both countries.
In order to ensure the enforcement of the Tax Code of the Republic of Armenia, the Government passed a number of decisions. In particular, dividends received from the state budget shall be paid in the case of dividends in the form of dividends paid in the statutory or equity capital of the same resident of the Republic of Armenia in the manner prescribed by law.
