Armenia approves bill allowing taxpayers to allocate income tax to media, NGOs and parties

By Siranush Adamyan

Armenia’s government on Sept. 17 approved a bill that would allow individuals required to file annual income-tax declarations to allocate part of their assessed or paid income tax to eligible non-governmental organizations, media outlets and political parties.

The bill expands Armenia’s social-credit system. Finance Minister Vahe Hovhannisyan said the system currently allows taxpayers to recover part of their spending on health care and education through annual income declarations.

Under the proposed changes, funds allocated to NGOs, legal entities and individual entrepreneurs engaged in media activity, and political parties would be recognized as a new category of social expenditure.

“The government’s program envisages expanding the scope of social credits,” Hovhannisyan said. “With this change, we propose including NGOs, entities engaged in media activity and political parties.”

He said individuals would be able to make allocations to those groups from their paid income tax.

The proposal does not set the amount that can be allocated. The government will later determine the maximum amount, the eligible categories of NGOs, media entities and political parties, the criteria they must meet, and the reporting and disclosure rules.

The measure is therefore not structured as a conventional tax deduction for a private donation. It would allow a person to make an allocation from income tax through their annual declaration after the end of the reporting year.

Labor and Welfare Minister Arsen Torosyan said the government was creating a mechanism for citizens to support organizations that create public goods.

“When an NGO, a media outlet or a political party creates a public good and is visible, people themselves will want to help create that public good,” Torosyan said. He added that the government would promote the mechanism and encourage citizens to direct funds toward issues they consider important.

The Finance Ministry’s explanatory note says the proposal is intended to create an institutional mechanism for individuals to financially support such organizations. It says the sustained work of civil society groups, media entities and political parties is important for civil society, independent political parties and free, impartial speech.

Justice Minister Srbuhi Galyan said the proposal also highlighted the need for NGOs and media outlets to operate lawfully and in good faith.

She said draft legislation to establish a media self-regulatory body was with the prime minister’s office and could be presented at an upcoming government meeting. That separate package would set possible indicators for assessing good-faith conduct, she said.

“Media outlets should strive to meet those requirements and thereby become media outlets considered to be acting in good faith by our citizens and eligible to seek these financial allocations,” Galyan said.

The tax bill itself does not yet spell out those standards. The Finance Ministry has said the government will not compile a named list of eligible media outlets or organizations, but will instead establish their scope and eligibility criteria.

If parliament adopts the bill, it would apply to income tax assessed or paid for 2026 and subsequent tax years. The government would then have three months to approve the required implementing regulations.

According to State Revenue Committee data cited at the meeting, 81,000 people received a combined 6.3 billion drams, or about $16.5 million, in social credits in 2024. As of September 2026, 92,000 people had received 7.5 billion drams, or about $19.6 million.