ArmInfo.The tax compliance gap in Armenia has been steadily decreasing since 2020, as stated by Deputy Minister of Finance Arman Poghosyan on March 20 during a meeting of the relevant National Assembly committee. He was presenting a report on the progress and outcomes of the Government Program (2021-2026) for 2025.
According to him, the tax administration gap was 6.5% of GDP in 2020, reduced to 5.6% in 2021, further to 4.8% in 2022, 4.2% in 2023, and was close to 4% in 2024. The assessment was based on IMF methodology.
"The figures indicate that the tax gap is steadily decreasing, and in fact, over the past five years, the figure has dropped by approximately 2.5% of GDP," the Deputy Minister noted.
It is worth noting that the Report on the Progress and Outcomes of the Government Program (2021-2026) for 2025 was approved at the Cabinet meeting on February 26. According to the document, in 2025, Armenia's per capita GDP amounted to 3,666,540 drams or $9,474. This represents a 10.7% increase in dollar terms compared to the previous year and a twofold increase compared to 2021. Compared to 2017, this indicator has increased by $5,605, or approximately 2.5 times. High economic growth (7.2%) was recorded, resulting in an average annual GDP growth of 7.9% in 2021-2025.
By the end of 2025, state budget revenues amounted to 2 trillion 886.5 billion drams, approximately 307.3 billion drams or 11.9% more than the previous year. Thus, 101.3% of the program set by the Government of the Republic of Armenia was achieved, a 5.5 percentage points increase from the previous year. In total, tax revenues and state duties amounted to 2 trillion 725.2 billion drams, representing 100.3% of the planned expenditures and an increase of 7.6 percentage points compared to the previous year. In 2025, tax revenues and state duties of the state budget increased by approximately 14% compared to the previous year, or an increase of 334.3 billion drams.
State budget expenditures in 2025 amounted to 3 trillion 305.3 billion drams, an increase of 11.8%, or 350 billion drams, compared to 2024. Expenditure plan fulfillment under the revised program was 95.8%, an improvement of approximately 2 percentage points compared to the previous year.
Compared with the previous year, capital expenditures increased by 144.8 billion drams, or 26%, amounting to over 702.5 billion drams. In 2025, capital expenditures under the revised program amounted to 89.6%, improving by 4.9 percentage points compared to the previous year. In the reporting year, capital expenditures in the economic and social sectors continued to grow, amounting to about 255.4 billion drams, an increase of 35.3% compared to 2024, and taking into account subsidies allocated for co-financing of community investment programs, about 293 billion drams, an increase of 31.6% compared to 2024. As a result of the high growth recorded in recent years, the level of capital expenditures in the economic and social sectors in 2025 (including a portion of subsidies) increased more than threefold compared to 2018 (3.5 times).
