Lawyers start protest against Bar taxation 

ArmInfo. The members of the Bar Club once again expressed dissatisfaction with the discriminatory tax policy of the Armenian authorities and announced their intention to hold a protest on February 10. This is stated in a statement received by ArmInfo from the Chamber of Advocates.

The statement recalls that the lawyers are demanding a legislative  initiative from the Armenian government aimed at exempting the  provided legal services from value added tax (VAT), which will enter  into force on January 1, 2025, in accordance with the law "On  Amendments to the Tax Code of the Republic of Armenia".

"At the meeting of the Bar Club, a decision was made to suspend the  protection and representation of clients' interests in state bodies  of the Republic of Armenia, including courts and preliminary  investigation bodies," the statement reds.

The Chamber of Advocates explained what consequences the application  of the new law may have.  According to their statement, the law  significantly worsens the protection of violated rights of citizens,  excludes the possibility of providing free legal aid and  significantly increases the cost of legal services.  This limits  access to legal aid and complicates the implementation of judicial  protection, creating an unforeseen financial burden for lawyers and  legal organizations that are obliged to continue to provide  assistance under already concluded contracts.

"The application of this law also creates discriminatory conditions  for citizens - individuals. Unlike commercial organizations that pay  VAT, the cost of legal services for citizens increases by twenty  percent.  This leads to an additional burden on lawyers and increases  expenses, since there is a need for accounting services. In addition,  the law limits the development of the legal institution,  significantly complicating the creation of new law firms due to the  high tax burden, and creates discriminatory conditions for lawyers  compared to other sectors of the economy where preferential tax  conditions apply," the statement explains.

According to the source, the recent actions were also presented at  the meeting. In particular, lawyers sent a petition to the government  signed by about 1,200 lawyers asking to exempt free and voluntary  legal aid from VAT. In addition, 31 deputies filed a complaint with  the Constitutional Court challenging the constitutionality of the  provisions of the current Tax Code concerning the legal profession.

Recall that earlier, the Chamber of Advocates of Armenia sent a  collective petition to the government of the country asking to  reconsider the amendments to the law, which provide for an increase  in the taxation of legal activities.

In connection with the amendments initiated by the government, which  were adopted by parliament, the taxation of legal activity will  increase from the current 5% to more than 30%. In addition, the  accounting procedure will change: if previously it was conducted on  the basis of turnover, now it will be necessary to take into account  expenses, which will lead to additional costs.

Lawyers criticized this initiative of the authorities, noting that  this will significantly increase the cost of their services for  citizens and may lead to a situation where certain segments of the  population will be deprived of the opportunity to use legal  assistance.