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Ruling faction lawmakers propose to raise minimum salary, setting it 63.000 drams

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24.05.2019
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MPs of the ruling My Step faction of the Armenian Parliament Varazdat Karapetyan and Babken Tunyan propose to raise the minimum salary by 8000 drams, setting it 63.000 drams instead of the current 55.000 drams. This will reach the minimum salary to the minimum consumer basket.

Lawmaker Varazdat Karapetyan introduced the purpose and details of the bill on making changes in the Law on Minimum Monthly Salary in an interview to ARMENPRESS.

“These 8.000 drams will not change a lot for many families, but by this we will at least make the salary closer to the minimum consumer basket so that the people would be able to ensure a minimum standard of living for themselves. When we were holding pre-election meetings in provinces, in particular with the employees of the non-commercial community organizations, the most important issue which was raised was the amount of the minimum salary. From these meetings, also due to the fact that many jobs emerge from the shadow which is accompanied by reflecting the amount of the real salary, we understood that it’s time to increase the minimum nominal salary”, he said.

In the initial version of the bill they have discussed raising the minimum salary up to 65.000 drams, but MP Karapetyan said in case of such an increase the coefficients would change, therefore the option of 63.000 drams was selected. According to him, this is just the first small step. The lawmaker believes that the minimum salary should be at least 120.000 drams within the next 4-5 years and states that he is going to constantly work on this path.

According to the data provided by the State Revenue Committee, the number of people working full-time with up to 81.820 drams salary, including taxes, doesn’t exceed 45.000, 8.400 of whom work in the public sector and 6.000 in the non-commercial community organizations. In case of the adoption of the bill the people’s salaries will increase by an average of 6.270 drams. These changes will require nearly 840 million AMD additional expenditures from the state budget, and 392 million drams from the community budget. Overall, the allocations for the salary both in the private and public sectors will comprise around 3.46 billion drams.

The lawmaker assures that the change will not have a significant impact on the state budget. “We are raising the salaries of the people who receive wages from the budget system, but the private sector will also raise the salaries. And thus, more entries of the income tax will cover the state budget expenditure”, he said.

The increase of salaries both in the private and public sector will comprise 3.46 billion drams, from which 0.8 billion drams will be returned to the state treasury as an income tax. As a result of the increase, the difference between the salaries in public and private sector will also be cut.

As for the additional expenditure on the community budget, Karapetyan said people in the communities must receive normal salaries. “The community leaders should refuse from the old practice by keeping employees with a minimum salary who later must have given their votes to the companies. And the gradual increase of the minimum salary will be accompanied also by this process so that the local self-government bodies will understand that it’s better to have one normal specialist”, he said.

Karapetyan said if the bill is debated and adopted, they will come up with an initiative to raise the minimum salary every year.

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