Why Armenian MPs Want to Abolish Luxury Tax on Expensive Cars

Republican Party of Armenia (HHK) MP Vardan Ayvazyan and Prosperous Armenia Party (BHK) MP Mikael Mejlumyan introduced a bill that proposes to eliminate the luxury tax on the import of expensive cars.

According to the MPs, the current law has led to people not purchasing and importing into Armenia vehicles that cost 25 million AMD (about $60,550 USD) or more because they are forced to pay 20% of the value of the car in taxes. According to Ayvazyan, if the luxury tax is removed, budgetary revenues will increase since there will be a greater imports of cars. 

Armenian Revolutionary Federation (ARF-D) MP Artsvik Minasyan said he believes the program is solely for fiscal objectives, and it is done only for a few people, those who want to buy expensive cars. 

Head of the ARF-D faction Armen Rustamyan, in turn, said the submission of the bill at this time is no coincidence since beginning in 2015, when Armenia joins the Customs Union, a new economic zone, there will be a new system of taxation. 

"Perhaps this is so that some people bring in expensive cars cheaply, then after we join the Customs Union, they sell it for a higher price and make extra profit," said Rustamyan. 

During discussion of this bill, head of the Armenian National Congress faction Levon Zurabyan said that even without that there are more expensive cars in Armenia than in wealthy European countries.