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THE LAW OF THE REPUBLIC OF ARMENIA

ON EXCISE TAX

07.07.2000
Non official translation
Article 1. Subject of the Law

This Law regulates the payment and estimation of excise tax in the territory of the Republic of Armenia, determines the products subject to excise tax, the scope of taxpayers, tax rates, tax calculation and payment procedures, as well as liabilities in case of violations of the present Law.

Article 2. Excise Tax

Excise tax is an indirect tax paid to the state budget according to established procedures and rates for importing goods subject to excise tax and for the realization of such goods produced in the territory of the Republic of Armenia.

Article 3. Goods Subject to the Excise Tax and Tax Payers

1. The following goods shall be subject to excise tax: beer, grape and other wines, wine ingredients, spirits, cigars, cigarillos and cigarettes with tobacco or its substitutes, petrol and diesel fuel.

2. Excise tax shall be paid by individuals, legal persons (including branches and representatives of foreign legal entities registered in the Republic of Armenia) importing or exporting goods subject to excise tax in the Republic of Armenia.

3. For goods subject to excise tax that are manufactured (produced or bottled) in the territory of the RA from raw materials (including bottling or other type of packaging) obtained on a contractual basis with contractors (providers of raw material) who are registered in the RA according to established procedures, the provider of the raw materials shall be considered the taxpayer.

4. For the goods subject to excise tax that are manufactured (produced or bottled) in the territory of the RA from raw materials (including bottling or other type of packaging) obtained on a contractual basis with contractors (providers of raw material) who are not registered in the RA according to established procedures, the manufacturer (producer or bottler) of the raw materials shall be considered the taxpayer.

5. In the case of conveying to the mortgagee the right to manage the mortgaged goods according to the established legal procedures the mortgager shall be liable for the excise tax provided the latter is considered a taxpayer in accordance with the present Law.

Article 4. Object of the Tax and Taxable Base

1. The following shall be considered objects of excise tax:
a) goods subject to the excise tax imported to the Republic of Armenia under "import for free turnover" customs regime.
b) the realization (including free of charge) in the territory of the Republic of Armenia of goods subject to the excise tax by the manufacturers (bottlers).

In terms of implementation of the present Article, the in-kind payment for the work related to the goods subject to excise tax, their exchange or transfer (for free provision, compensation or other type of realization) shall be considered a taxable object.

2. In terms of the present Law the taxable base shall be considered the actual amount of the quantity (volume) of the goods subject to excise tax to which the legally established rates are applied to calculate the excise tax amount.

Article 5. Excise Tax Rates

1. The following excise tax rates shall be established:

 
Code of the production according to the trade nomenclature of the External Economic Activity 
Name of the group of products 
Taxable base 
Rate of Excise Tax (Dram)
2203
beer
1 liter
70
2204
grape and other wines, wine ingredients
10 percent of factory price (not including VAT and excise tax) or customs value - in case of import, but not less than 100 AMD per liter
2205
Vermouth and other types of wine that contain vegetarian and other aromatic extracts
1 liter 
500
2206
Other brewed drinks 
(apple cider, Pearru (pear cider), honey-drinks)
1 liter 
180
2207
Ethyl spirit 
1 liter (by re-calculation of 100% spirit) 
600
2208
Alcoholic drinks
1 liter
30 percent of factory price (not including VAT and excise tax) or customs value - in case of import, but not less than 380 AMD per liter
2403
Tobacco substitutes
1 kilogram
1,500
2709
Raw oil and oil materials
1 ton
27,000
2711 (excluding 2711 11 and 2711 21)
Gases produced from oil and other hydro-carbons (except for natural gas)
1 ton
1,000
2. According to clause 1 of this Article for goods under 2208 code with spirit concentration over 40 percent the excise tax rate shall be increased by an additional 7.5 drams for each percent exceeding 40 percent, and for drinks with spirit concentration up to 9 percent the rate is set at 100 AMD per liter.
3. The excise tax rates of tobacco products and imported diesel fuel and petrol are determined by separate laws.
4. The Law may establish a fixed payment instead of excise tax.

Article 6. Excise Tax Privileges

1. The following shall not be subject to excise tax:

a) alienation (sale) of products exported from Armenia and subject to excise tax, if the document specified in sub-clause “b” of clause 1 of Article 9 of the Law is available.

b) Goods subject to the excise tax imported into and exported from the customs territory of the Republic of Armenia under customs regimes established by the customs legislation that differ from "Import for free turnover" regime.

c) Import and realization of goods subject to excise tax that are confiscated in accordance with procedures established by legislation, goods recognized as having no owner and transferred to the State, as well as good transferred to the State by the right of inheritance.

d) Goods subject to excise tax imported into the Republic of Armenia by individuals who are not entrepreneurs that do not exceed the value or quantity established by customs legislation.

2. The Law may define other excise tax privileges.

Article 7. Labeling of Goods Subject to the Excise Tax

1. The Government of the Republic of Armenia may establish the procedure for labeling goods subject to the excise tax imported into or exported from the Republic of Armenia.

2. The amount paid by excise taxpayers to obtain excise stamps shall be considered a prepayment of the estimated excise tax, and for those who pay presumptive tax instead of excise tax according to procedures established by legislation such payment shall be considered as a reduction from presumptive tax and may not offset other tax liabilities with the exception of cases specified by the stamping procedure.

Article 8. Excise Tax Payment and Terms of Calculation

1. Taxpayers (subject to excise tax) importing into the Republic of Armenia goods subject to the excise tax shall pay the excise tax within 10 days after import in accordance with the procedure established by the Government of the Republic of Armenia.

2. For taxpayers (subject to excise tax) producing goods subject to the excise tax in the Republic of Armenia the reporting period shall be established every month, according to the procedures of the present Law.

3. Taxpayers stated in clause 2 of the current Article shall for every reporting period pay the tax before 15th of next month and shall present to the appropriate local tax inspection the calculation of the excise tax in accordance with the procedure established by the Ministry of State Revenues of the Republic of Armenia.
The excise tax declaration also is submitted in cases described under sub-clause “a” of clause 5 of this Article.

4. Miscalculations and mistakes made by the taxpayers in calculating the tax amount for the reported period may be identified and corrected by the payers, and corrected accounts may be submitted in accordance with the established procedure. The terms and submission procedure shall be approved by the Ministry of State Revenues with agreement by the Ministry of Finance and Economy of the Republic of Armenia.

5. The excise tax amount paid in accordance with this Law for raw material taxed under excise tax that are obtained in or imported into the RA by the producers of the excisable goods:
a) shall be reimbursed according to the procedures and terms defined in article 9 of this Law in cases when the excisable goods made from the raw material are exported;
b) shall be deducted (except in cases mentioned in clause 6 of this article) from the total excise tax amount subject to payment in the reporting period in an amount in proportion to the sales of excisable goods based on the calculation documents.

6. The amount of excise tax paid in accordance with this Law by the taxpayers, producing goods subject to the excise tax in the Republic of Armenia for the raw materials subject to the excise tax which is purchased in or imported to the Republic of Armenia shall be deducted from the total amount of the excise tax paid by them for the reporting period in an amount in proportion to the realization of the goods subject to excise tax. The terms of pay-sheets submission, the procedure for completion and the procedure of deducting excise tax from purchased raw materials shall be established by the Government of the Republic of Armenia.

7. The RA government shall establish the requirements for calculation documents and the procedure of completing those documents, as well as the procedure for deducting excise taxes paid for raw material described in clauses 5 and 6 of this Article.

Article 9. Refund of Excise Tax

1. The amount of the excise tax paid by state-registered individuals for export of goods subject to excise tax and obtained from those who pay excise tax in the Republic of Armenia, shall be offset against other tax liabilities of the taxpayer, or returned in accordance with the procedure established by the legislation, provided the following documents are presented:

a) copies of pay-sheets and documents evidencing the payment for the goods from excise taxpayers in the Republic of Armenia;
b) the copy of customs declaration with the note "The pass is allowed", completed in accordance with the procedure established by customs legislation.

2. The amount of the excise tax shall be reimbursed according to due procedure of Law if the taxpayer does not have any outstanding tax liabilities, or will be credited against other tax liabilities:
a) for excise taxpayers the refund or credit will be provided within 30 days after the taxpayer submits a request and after presenting the documents referred to in clause 1 of this article based on the excise tax calculations provided for each reporting period;
b) for non-excise taxpayers the refund or credit will be provided within 30 days after the taxpayer submits a request in due procedure defined by the State Revenues Ministry and after presenting the documents required under clause 1 of this Article.

Article 10. Responsibilities for Violations of the Law

1. The violation of the present Law entails responsibilities according to the procedure according by the legislation.

2. In case of concealing or understating the actual taxable base and/or the object taxable by excise tax, the taxpayer shall be subject to a penalty equal to 100 percent of the concealed or understated amount of excise tax.

3. Taxpayers shall pay fine of 200 thousand drams for the submission of more than one of each corrected excise tax payment document for every reporting period according to the procedure stated in the 4th clause of Article 8 of this Law.

Article 11. Administrative Normative Acts Connected with the Implementation of the Law

Regarding the implementation of this Law, the administrative normative acts shall be adopted by the State Revenue Ministry of the Republic of Armenia with agreement by the Ministry of Finance and Economy of the Republic of Armenia.

Article 12. Effective Date of the Law

1. The Law of the Republic of Armenia "On Excise Tax" dated June 24, 1997, together with its subsequent amendments and additions, shall be declared void from the moment of getting into force the present Law.

2. This Law shall enter into force on August 1, 2000.

President of the Republic of Armenia
Robert Kocharyan

27 July 2000
AL-79


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