Penalties for illegal entrepreneurship were increased by amendments to the Law on Taxes effective from January 1, 2012. Conducting business activities without registering with tax authorities is henceforth punishable by a fine of 50% of the sales turnover (gross income) but not less than 200,000 drams (approx. $513). Penalties are doubled if the violation reoccurs within one year.
Where business is subject to licensing, failure to obtain such license is punishable by a fine of ten times the amount of the state duty payable for the license in question but not less than 500,000 drams (approx. $1,280). Here again, penalties are doubled if the violation reoccurs within one year. In addition, damages in the amount of the state duty are recoverable.
