On November 13, Acting Finance Minister Atom Janjughazyan presented the RA Draft Law "On the 2019 State Budget of the Republic of Armenia" during the National Assembly sitting.
According to Atom Janjughazyan, the economic environment and the anticipated economic events have been taken into account in the process of drafting the budget.
He pointed out that the GDP per capita will be USD 4280 in 2018, and in 2019, according to forecasted assessments, USD 4604.
Touching upon the tax policy in the draft budget, Acting Minister noted that in the near future reductions of tax burden, simplification of the system, introduction of the principle of justice, ensuring the neutrality of impact on budget in the short-term, as well as reduction of income tax rate are envisaged.
Atom Janjughazyan underlined that in order to ensure the competitiveness in the exporting sector of the country, growth of business attractiveness, reduction of inequality and simplification of tax system are necessary.
About 70 percent of the expenditures envisaged by the 2019 draft budget are for the fulfillment of obligations defined by law, about 9 percent are liabilities arising from government decisions, 11 percent are international commitments, and 10 percent are an optional part of the state budget.
“Due to the fiscal policy underlying the budget draft, the golden rule is maintained, according to which capital expenditures exceed the deficit and there is a tendency for debt stabilization”, - noted Atom Janjughazyan.
Capital expenditures in the GDP will make 3.2 percent, the deficit - 2.2 percent. Current expenditures / GDP ratio will comprise 21.1 percnet, tax revenues / GDP ratio - 20.7 percent: it was recorded 0.4 percentage points of growth in comparison with the previous year.
In 2019, the budget deficit will make AMD 151.6 billion, the forecast of net borrowings - about AMD 225 billion, AMD 70 billion will be financed through the issuance of bonds attracted from domestic sources, and AMD 155 billion - at the expense of external loan means.
From the AMD 1 trillion 642 billion planned by the draft, AMD 1 trillion 423 billion will be spent on current expenditures and 220 billion - on capital expenditures.
According to the draft state budget for 2019, AMD 761 billion are provided for public services of general significance, AMD 162 billion - for economic services and AMD 708 billion - for social services.
The expected debt / GDP ratio for 2018 is around 50.6 percent, and for 2019 - 49.7 percent.
The draft state budget for the first time in 2019 has been presented in the program budgeting format.