Armenian tax authorities uncover 2.6 billion drams in hidden turnover at Yerevan sports complex

Armenia’s State Revenue Committee (SRC) said it has uncovered a case of alleged large-scale tax evasion involving a sports and wellness complex in Yerevan, with investigators identifying about 2.6 billion drams ($6.7 million) in undeclared turnover.

The SRC’s Investigation and Operational Intelligence Department said it launched a series of investigative measures after receiving information that the complex had systematically underreported income from its operations in order to reduce its tax liabilities.

Officials examined the company’s electronic records, internal accounting documents and other information reflecting the actual scale of its business activity. A comparison of the findings with data held in the tax authority’s databases revealed significant discrepancies between the company’s reported figures and its actual operations, the SRC said.

According to the agency, the company failed to declare approximately 2.6 billion drams in turnover in its tax filings for 2023 and 2024. As a result, more than 832 million drams in tax obligations were not assessed or paid to the state budget.

Investigators also found that part of the company’s operations had allegedly been carried out through legal entities registered under the names of former employees in an effort to reduce the company’s tax burden. The SRC said those entities operated under a special tax regime.

Through that arrangement, about 158 million drams in turnover was allegedly excluded from the company’s value-added tax calculations, resulting in more than 17 million drams in additional unpaid tax obligations.

The SRC estimated the total damage to the state budget at about 849 million drams.

Based on the evidence gathered, authorities filed a report of a suspected crime with law enforcement bodies. A criminal case has been launched and a preliminary investigation is underway.

The State Revenue Committee said it would continue efforts to combat the shadow economy and pursue cases involving alleged tax evasion schemes.