The Central Bank claimed that the court did not temporarily exempt Armenians aged 40 and younger from paying more social security taxes when it suspended the reform late last month pending hearings on an opposition appeal against the unpopular measure. It warned that employees refusing to pay up now will face “more severe consequences” if the court rejects opposition claims that the reform is unconstitutional.
The office of Armenia’s human rights ombudsman, Karen Andreasian, insisted, meanwhile, that the reform was frozen in full on January 24. In a statement, it said that employees cannot be forced to pay the extra taxes for the following months if the court rejects the opposition appeal. It cited a constitutional provision that forbids retroactive enforcement of decisions made by the government and other state institutions.
“We hope that the court will address the issue in its verdict. We hope that the verdict will be in citizens’ favor,” Meri Khachatrian, an adviser to Andreasian, told RFE/RL’s Armenian stance (Azatutyun.am).
The Central Bank’s stance was condemned as illegal by opposition leaders. “The statement amounts to an expression of contempt for the decision made by the Constitutional Court,” said Levon Zurabian of the Armenian National Congress (HAK).
Another opposition figure, Ruben Hakobian, claimed that tax bodies and employers already deducting 5-10 percent of workers’ monthly wages in line with the reform are committing a crime.
Constitutional Court hearings on the opposition appeal are scheduled to open on March 28.
Protests Against Pension Reform Resume
Hundreds of mostly young people rallied in Yerevan on Thursday to demand that the Armenian authorities stop enforcing a controversial reform of the national pension system that was suspended by the Constitutional Court late last month.
The court froze the entry into force of a relevant government-drafted law at least until its ruling on an appeal lodged by Armenia’s four main opposition parties. It is scheduled to open hearings on the appeal on March 28.
The court order led to differing interpretations, however, with many state agencies and private firms continuing to deduct an extra 5-10 percent of the monthly wages of their employees born after 1973. The money has to be invested in private pension funds in accordance with the highly unpopular measure approved by the Armenian parliament late last year.
The protesters, most of them young professionals affected by the reform, accused the government of ignoring the Constitutional Court’s decision as they marched to key government buildings in central Yerevan. They said that employers are being forced by tax authorities to collect the extra social security taxes.
“The authorities distrust the Constitutional Court. Government representatives are worried that the Constitutional Court could once again make such a decision,” said Meri Khachatrian, a member of the Dem Em (I Am Against) pressure group campaigning against the reform.