The Armenian National Committee of America (ANCA) welcomes news that the negotiation of a U.S.-Armenia Double Tax Treaty, a longstanding ANCA policy priority, will be on the agenda of the upcoming U.S.-Armenia Economic Task Force meeting, an annual bilateral gathering taking place in Washington, DC on November 19th.
“An updated U.S.-Armenia Double Tax Treaty is long overdue and badly needed to establish a clear legal framework for investors and individuals that are conducting business activities in both jurisdictions,” said ANCA Executive Director Aram Hamparian. “Beyond the immediate benefits of preventing double taxation and removing a key barrier to increased investment, such an accord would, more broadly, reinforce the friendship of the American and Armenian peoples, facilitate the expansion of bilateral economic relations, deepening Armenia’s ties to the West, and providing Yerevan with greater strategic options and independence in dealing with regional powers.”
In August of this year, the ANCA met with Treasury Secretary Jacob Lew regarding the Treasury Department’s role in the further growth of the U.S.-Armenia economic relationship, with a special focus on the mutual benefits of a new U.S.-Armenia Double Tax Treaty.
The Republic of Armenia has repeatedly asked for a new agreement to replace a 1973 U.S.-U.S.S.R. Tax Treaty. This outdated, forty year-old accord, which Yerevan no longer considers in force, was intended as a limited agreement, even by the standards of the 1970s, between two hostile superpowers. It is clearly insufficient to the needs of the present-day economic relationship with Armenia. The lack of a modern treaty, acceptable to all parties, results in a lack of clarity and represents a substantial deterrent for potential U.S. investors. Without an updated Tax Treaty, U.S. businesses will continue to face significant burdens on investment and cross-border services and payments, as well as a lack of transparent information exchange and obstacles to cooperation on tax and related matters.
Prior to the November 19th U.S.-Armenia Economic Taskforce meeting, the first-ever meeting of the newly created U.S.-Armenia Trade and Investment Framework Agreement Council will take place on November 16th and 17th. This inaugural meeting is set to be chaired by the U.S. Trade Representative, Michael Froman, and Armenia’s Minister of Economy Karen Chshmaritian. The signing of a U.S.-Armenia TIFA, the result of nearly a decade of ANCA advocacy and bilateral dialogue, took place this May in Washington, DC.