Citizens of Armenia will be able to pay off their loans using income tax funds

The authorities of Armenia propose to restore the economic activity of citizens without an official income source starting February 1, 2025, by offering them support in the form of their income tax, which will allow them to pay off their loans. However, this only applies to loans that are at least 3 years old with a debt amount of up to 1,000,000 drams.

According to the Central Bank of Armenia, as of October last year, approximately 341,000 citizens have poor credit histories and debts totaling 642 billion dollars. Due to the increase in these figures, the government has proposed a program to assist borrowers aged 25 to 50 years.

In addition, for participants of the program, Armenian banks will reduce credit penalties by 80%.

Citizens will be able to apply for the program by submitting an application through an online platform, which is currently under development.

We believe that such an initiative will positively impact citizens' motivation to seek official employment rather than engage in the shadow economy. With government support, borrowers will be able to pay off their loans using their income tax funds and resolve their banking debts.

Regina Melikyan