The Authorities Decided to "Punish" Yerevan Residents by Abolishing Income Tax Refunds: Ananyan

Former Head of the State Revenue Committee David Ananyan wrote on his Facebook page: "The process of abolishing the income tax refund institution for mortgage loan interest began in 2021, when legislative changes led to the announcement of a timeline that stipulated the gradual abolition of the system in Yerevan starting July 1, 2022, and fully by January 1, 2025.

Why was the decision made in 2021 to cease the operation of this institution in Yerevan? Previously, since the introduction of the system (i.e., from November 2014), experts had voiced the necessity to abolish this system, but in vain, as its social significance was deemed extremely important by the ruling political circles. What made the experts’ arguments more convincing for the political power this time? Perhaps it was the ruling political force’s effective defeat in the parliamentary elections held in June 2021 in Yerevan that prompted the decision to "punish" Yerevan residents by abolishing the income tax refund institution, simultaneously considering that the social significance of the system is no longer that essential in Yerevan, as this electorate does not significantly interest them.

Now, the possibility of abolishing this institution is also being discussed in the provinces, starting in 2027 with Aragatsotn, Ararat, Armavir, and Kotayk regions, and from 2029 throughout Armenia, with the exception of border villages. Essentially, such a decision serves as a unique "signal" for companies in the construction sector to urgently undertake construction activities in these regions to realize their business intentions within a short-term horizon of 3-5 years.

With the upcoming elections (both extraordinary and regular) in mind, working with the relevant electorate in the context of a construction boom in the provinces will undoubtedly become easier.