MP Sees Corruption Risks in Providing Benefits to IT Companies

The Armenian government plans to provide a number of benefits to the IT sector; in particular, a 0% corporate tax rate and a 0% income tax rate — regardless of the amount of taxable monthly income, according to a draft bill presented by RA Deputy Minister of Economy Garegin Melkonyan to MPs in parliament today. 

According to him, these benefits will significantly contribute to the establishment of start-up IT companies and the creation of new jobs. However, some MPs spotted corruption risks in the draft proposal. In particular, Republican Party of Armenia MP Hakob Hakobyan said the benefits will increase "under the table" activities (the shadow economy), which is "already huge in the IT sector." Melkonyan, however, said a mechanism is in place that will prevent this.

The MP also expressed doubt concerning on what basis will it be decided which IT companies will be given benefits. In response, the deputy minister said a commission will be established, which will act impartially and will decide to give certification to start-up companies in accordance with a set of standards.