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Armenian government to reduce salaries to population

07 December 2019 [10:23] - TODAY.AZ

By Azernews

By Abdul Kerimkhanov

The Armenian government intends to take another unprecedented step that will upset the local public. Armenian executive branch is reported to lower the salaries of almost all working citizens, which none of the previous governments did.

Authors of the idea urge that a decrease in salaries will occur in two years.

A single site for the publication of draft legal acts has published a bill introducing a tax on health. In fact, it is about total health insurance, but its implementation is proposed by introducing an additional tax of 4-6 percent of the salary.

People familiar with the document found a lot of dubious moments there. For instance, they considered the document as dishonest and contradictory to the principles of social justice, because it involves solving the problem of medical care at the expense of the entire Armenian working population.

In addition, based on current average wage in Armenia, a 4-6 percent additional taxation of salaries (7,000-10,000 drams or $14.7-$21) will be a rather significant blow to the budget of the majority of Armenian families.

Since last year, Prime Minister Nikol Pashinyan has been offering the public his formula for assessing the level of wages and incomes of the population. For instance, he called the decision to reduce contributions to the funded pension fund from 5 percent to 2.5 percent as a way to increase wages. Pashinyan also considered the growth of salaries to be equalization of income tax.

In the current situation, it becomes clear that the authors of the above-mentioned bill are in confrontation with Pashinyan's proposals. Indeed, if a decrease in tax pressure on salaries can be called an increase in salaries, then an increase in taxes is a decrease in salaries.

Thus, the Armenian government seems to take really an unprecedented step - to lower salaries. In any case, according to Pashinyan’s formula, all this looks exactly like this.

The Armenian government may abandon this formula, but that will annoy the local people even more.


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