Like most small businesses in Armenia, law firms and individual attorneys have until now paid a single “simplified tax” equivalent to just 5 percent of their annual turnover. A government bill submitted to the parliament earlier this month would replace it by value-added and profit taxes levied from many other entities. Those tax rates are set at 20 percent and 18 percent respectively.
In an explanatory note attached to the bill, the government describes the existing system as a privileged treatment of legal profession and says the lawyers must be taxed like the vast majority of other taxpayers.
“This is concerning and unacceptable for us,” said Simon Babayan, the chairman of the Armenian Chamber of Advocates, the national bar association that initiated the strike.
Babayan and other protesting lawyers argued that the higher taxes would sharply raise the cost of their legal services and make them unaffordable for many Armenians. They also claimed that they would no longer be able to do pro bono work for low-income citizens because that too would be subject to taxation.
Although the bill has already been approved by the parliament’s standing committee on economic issues, it is not yet clear when the National Assembly will debate it. Some pro-government lawmakers have reportedly expressed misgivings about the proposed measure.