VIDEO: 'To Solve the Issue of Poultry Self-Sufficiency, Certain Products Will Be Exempt from VAT at the Border' - Gevorgyan

The National Assembly of Armenia plans to exempt certain economic operators who import corn, soy seeds, and certain soy by-products from value-added tax (VAT). The draft law on making amendments and changes to the law on approving the list of goods imported by organizations and individual entrepreneurs that are exempt from VAT was presented at the regular session of the Standing Committee on Economic Affairs by the Deputy Minister of Economy Rafael Gevorgyan.

"The specified imported products are primarily used in the process of preparing feed for poultry production. Exempting our economic operators from VAT in this production chain will have a positive impact and allow us to create a more competitive price. We are not self-sufficient in poultry; we are at a rather low level. Through this change, we want to give our producers the opportunity to create a more competitive cost price," said Gevorgyan.

He noted that a significant portion of the production cost of poultry is formed by feed, and if VAT is not collected at the border, it creates a more favorable financial situation when it comes to the production phase. Gevorgyan emphasized that VAT will be collected at the sales stage.

QP deputy Hayk Aghazaryan questioned how an operator becomes competitive if VAT is still collected at the sales stage. The Deputy Minister of Economy highlighted that the rationale is that the operator imports the product, which is part of a larger value chain. The advantage lies in importing raw materials and encountering financial challenges before sales occur. A significant payment must be made initially, followed by production, and only then can the product be sold.

After all these operations, there can only be a potential income. According to Rafael Gevorgyan, this change addresses the issue of managing cash flows and less short-term reliance on borrowed resources.