By Nina Abgaryan and Shoghik Mikayelyan
Special to the Mirror-Spectator
YEREVAN — The introduction of mandatory income declaration marks a major change in Armenia’s tax system. While this is standard practice in many countries, for Armenian citizens it is something entirely new, which explains the confusion and frustration surrounding it.
Until recently, individuals were not expected to declare their income or deal with taxes themselves. For decades, employers took care of everything: calculating salaries, withholding taxes, paying them to the state, and filing reports through company accountants. This process was initially paper-based and transitioned to electronic systems about a decade ago. Throughout this transition, employees did not need to interact with tax authorities.
Over the past two years, this changed. The government first introduced income declaration for company founders and executives, and later expanded it to include all income-earning individuals. Accordingly, citizens are now required to independently declare all sources of income through the Electronic Reporting System and, when applicable, pay taxes through banks.
Unlike the US system, where individuals calculate their own taxes, Armenia’s tax obligations are set by the government. Much of the data — such as salary and bank interest — is already pre-filled using information from employers and banks. Citizens are expected to review and confirm this information rather than calculate everything from scratch. However, they must add any additional income that does not appear in the system.
