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How to become a millionaire, Armenia style

by Armen Hakobyan

Published: Friday February 13, 2009

Yerevan - Whoever thought getting a receipt for the purchase of a few groceries would generate so much excitement?

In Armenia in the early 90s even bread rations generated excitement. But now the to do is about cash register receipts. As of January 1, every cash register receipt is also a lottery ticket. The government of Armenia and the State Revenue Service embarked upon this venture where each receipt could win up to 5 million AMD (about $16,000). The objective is to encourage consumers to ask for receipts whenever they make a purchase or pay for a service.

The government has heavily advertising the scheme with the motto, "You win. The state wins." Announcements have been continuously broadcast on TV and radio. Banners and billboards throughout the country advertised the "Winning receipt."

It is the first time that the government is employing such a tactic to get store owners to first of all have a cash register and then provide the consumer with a receipt of purchase. All businesses are subject to these conditions, including beauty salons, restaurants, medical centers, and the like.

On the back of every receipt, there is an eight-digit printed number. The State Revenue Service expects to see a decrease in the hidden circulation of money in commercial transactions and services. The aim of the endeavor is to get people to become tax inspectors and ask for their cash receipts.

The first draw was held on Friday, February 6. Many were watching with excitement to see the results.

The winning numbers were announced by the famous actor and host Hrant Tokhatian, using small numbered balls. And finally the winning number was announced: 76201843.

According to the rules of the lottery, if the first four digits of the number on the back of the receipt are identical to the first four digits of the winning number, the bearer of the receipt wins 5000 AMD. In case the first five digits are the same, the winner gets 20,000 AMD; for the first six digits, the winner gets 50,000 AMD; for the first seven digits, the prize is 500,000 AMD. If all eight digits are the same, the winner gets 5 million AMD.

According to the official report released by the State Revenue Service, a winner for the 500,000 prize was Svetlana Mkrtchian from Gyumri. Ms. Mkrtchian won approximately $1,600 for a 400 AMD purchase. According to the authorities, Ms. Mkrtchian lives alone under very difficult social and economic conditions. She works as a sweeper and does not even have proper furniture in her home.

The results so far

Ms. Mkrtchian won. Did the state also win? Speaking with the Armenian Reporter, Armen Alahverdian, the vice president of the State Revenue Service, said that once all the information is collected, they will know by mid-February whether this lottery encouraged business owners to print out receipts.  "According to my observations and initial data, the monetary circulation of large businesses, that is, those having several stores, increased by 2-3 times compared to January 2008," said Mr. Alahverdian.

Some shopkeepers have devised new tactics to evade taxes. One shopper making a 50,000 AMD cat food purchase was told, "You are such a good customer, I am going to give you five chances to win," and was handed five receipts for 1,000 AMD each.

But shoppers asking for their receipts are not the only tax inspectors. Retailers failing to issue a correct receipt are subject to severe punishment. For  a first-time violation, they receive a fine ranging from 75,000 AMD to 150,000 AMD (depending on the amount that has been concealed from the tax department). The second time, the establishment is forced to close for 5-10 days. Moreover, Ardashes Beybutian, another vice president at the State Revenue Service, asserted that 1,067 inspections had taken place as of January 29, and  850 cases of violations were uncovered. In 786 cases, the violators were first-time offenders. They received fines amounting to just over 71 million AMD. Of that total, 34.6 million AMD were for violations in Yerevan and the remaining 36.8 million in the regions. Already 40 businesses have been suspended for 5-10 days.

Mr. Alahverdian told the Armenian Reporter: "The first results are satisfactory to me. There are people who have already won. We already know the person who is the winner of the 500,000 AMD prize. We are in touch with banks. We are aware of more than 60 cases of winners. I know that many have received their prizes (mainly 5,000 AMD prize)."

So far, no one has claimed the 5 million AMD prize. It could be that the receipt with that particular number doesn't exist. It seems that it is possible. According to Mr. Alahverdian, the numbers printed on the receipts are 8 non­repeating digits that are not printed sequentially. Some 100 million receipts are expected to be issued each month, about 10,000 of which could be the winners. The competition fund comprises 110 million AMD. However, only the receipts issued in a given month are allowed to participate in the lottery. Nevertheless, if there are no winners for the 5 million prize, according to the rules the amount is transmitted to the following months' fund.

The lottery committee consists of 10 members, four of whom represent NGOs. Abkar Yeghoyan, the president of the Consumer Rights' Protection NGO, is also a member of this committee. "Regarding the process of the lottery, I can say that everything proceeded normally," he said. "However, I hope that the more winners there are, the more successful the lottery will be, and the more often the consumer will ask for the receipt in the future."