Taxation of Expropriation

According to the Armenian Law on Alienation of Property for Public and State Needs, financial obligations arising from the transfer of property, in particular tax liabilities, shall be compensated by the acquirer. Furthermore, alienation of property in the interest of the public shall not cause unreasonable harm to the owner. Based on the foregoing, the Court of Cassation came to the conclusion that the compensation to be paid for expropriation of property shall not be taxed with VAT (Court of Cassation EKD/2028/02/10), nor profit tax (Court of Cassation VD/2575/05/09).