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How to save billions with tax service optimization

How to save billions with tax service optimization

Armenian tax inspectors 4 times ‘lazier’ than Georgian counterparts

There has been a lot of talk recently about unnecessary staff members in some state institutions. To make things clear, PAN decided to compare the number of tax inspectors operating in Armenia and Georgia and their responsibilities.

PanARMENIAN.Net - In a conversation with PanARMENIAN.Net a public relations officer of the Armenian State Revenue Committee (SRC) informed that the institution employs 1096 tax inspectors as of November 8, 2016, whose salary varies from AMD 158,000 to AMD 215,000 depending on the position and work experience.

A similar inquiry to the Georgian Revenue Service revealed that 1466 tax inspectors, including 127 tax managers, with an average salary of GEL 1020 (about AMD 200,000) have been registered as of October 31, 2016.

The database of the RA SCR contains information about 80,903 registered organizations, while the Georgian service controls 412,497 companies functioning in various business areas, which is five times more than in Armenia. That’s to say, one tax inspector in Georgia is charged to observe the activity of 281 organizations, while one Armenian inspector traces 74 firms. It turns out that the efficiency of the Armenia’s tax service is four times less that Georgia’s.

If an Armenian tax inspector worked with the same number of firms as a Georgian one, there would be 288 inspectors in Armenia (by 808 less than currently employed). So, over AMD 1,5 billion would be saved to the state budget only with the surplus of tax inspectors’ wages. If these 288 employees received a salary equivalent to Georgian average standard, annual saving would amount to AMD 1,387 billion, not including utility bills, transport and office costs, as well as other expenses.

Besides, Armenian and Georgian customs services hire 606 and 1466 inspectors respectively. In Armenia, these employees’ salary is equal to that of tax inspectors, while in Georgia, customs officers receive GEL 1141 (about AMD 220,000). It means that the number of customs officers in Georgia is 2,3 times more than in Armenia. However, it should be noted that Armenia has 5 customs points in all, while Georgia operates customs stations with Armenia, Russia, Turkey and Azerbaijan, has 3 international airports and 2 big ports with several customs points. Thus, the scope and pressure of work in the two countries is simply incomparable.

Kristine Kyurklyan / PanARMENIAN.Net
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