About Civil.ge
Eng | Geo | Rus
Last updated: 10:55 - 1 May.'18
RSS
Mobile
Twitter
Facebook
MPs Approve New Tax Code with First Hearing
Civil Georgia, Tbilisi / 30 Jun.'10 / 00:47

Parliament approved draft of new tax code with its first hearing on June 29, which will go into force, after its is passed with second and final third readings, starting from 2011.
 
The initial draft was revised after the government dropped plans to impose 18% value added tax on universities and on import of healthcare appliances. The government has also reiterated that no VAT would be imposed on press - a provision which was included in the initial draft of the tax code. VAT exemption will also apply to gambling and lottery businesses.
 
MPs from the ruling party welcomed new tax code, however noted that number of provisions needed further improvement.
 
Parliament’s Vice Speaker Mikheil Machavariani said that during the second hearing MPs should discuss in more details a provision, which reschedules initially planned cutting of income tax. 

In 2007 Parliament approved a government proposal, which went into force on January 1, 2008, replacing the 12% income tax and 20% social tax with a flat 25% income tax. Afterwards the government offered a five-year plan of gradual decrease of income tax, according to which in 2013 income tax should have been reduced to 15%.

But the proposed draft of new tax code envisages keeping 20% income tax till end of 2012 and its reduction to only 18% starting from 2013. The draft does not give details whether the government intends to further reduce income tax from 2014. Finance Minister, Kakha Baindurashvili, told lawmakers on June 29 that the income tax would probably be reduced to 15% starting from 2014.

The draft introduces a category of “micro business”, which covers those individual businessmen, whose annual turnover does not exceed GEL 30,000 (less than USD 16,000) and who do not use hired labor. “Micro businessmen” will be fully exempt of income tax.
 
Another category will be “small business”, which will include businesses with annual turnover of no more than GEL 200,000. Income of such businesses will be taxed either with 3% or 5% and will be exempt of VAT.
 
3% taxation will apply in case if “a small business” provides standard accounting documentation for at least 60% of their turnover (not counting staff salaries).
 
3% taxation will also apply to those “small businesses,” which operate in “special trade zones”, for example in outdoor markets.
 
According to the new code, a position of tax ombudsman will be created. The Finance Minister said that concrete procedures for appointing the ombudsman will be included in the draft by the second hearing.
 
In cases, when tax disputes between a taxpayer and authorities are caused by possible ambiguous provision of the code, the Finance Ministry’s council for adjudication of tax disputes will be authorized to take decision in favor of a taxpayer.
 
The government also plans to increase some of the excise tax, but it wants those those excise taxes to be enforced earlier then the new tax code goes into force from 2011. So the government had to present a separate draft of amendments to the current tax code. 

According to this draft, excise duties will be doubled starting from August 1 on ethyl spirit (reaching GEL 2.6 per liter), vodka (GEL 3 per liter), whisky (GEL 5 per liter), beer (GEL 0.4 per liter).
 
Excise duties on export of ferrous and non-ferrous metals will also go up from current GEL 80 per ton to GEL 120.
 
Excise will be introduced for telephone communication services. An exact tax rate will be defined by the government’s decision within 10% limit of total turnover of telephone communication services in accounting period.

Latest News
01 May.'18 10:55
We Have Moved to a New Platform
Direct Your Bookmarks to https://civil.ge.
29 Apr.'18 03:54
Ruling Party Candidate Wins MP By-Elections
Givi Chichinadze will represent Vani and Khoni single-mandate constituency in the Parliament of Georgia.
28 Apr.'18 09:40
Polls Open for Vani and Khoni MP By-Elections
48,123 voters are eligible to cast their ballots in Vani and Khoni single-mandate constituency.
27 Apr.'18 17:23
State Dept’s Europe Affairs Point Man to Visit Tbilisi
Wess Mitchell will meet senior government officials and address the NATO-Georgia Public Diplomacy Forum.
27 Apr.'18 13:45
In Quotes: Georgian Politicians on Ex-PM Bidzina Ivanishvili’s Comeback
Bidzina Ivanishvili will be approved as the Georgian Dream party chairman at the upcoming convention.
26 Apr.'18 18:15
SG Jens Stoltenberg: Georgia NATO’s ‘Very Close’ Partner
The NATO Secretary General says Foreign Ministers meeting tomorrow will recognize the country’s progress.
26 Apr.'18 14:24
Ex-PM Ivanishvili to Chair Georgian Dream Party
Prime Minister Giorgi Kvirikashvili said Ivanishvili was ‘best equipped’ to add new dynamism to the party.
26 Apr.'18 11:12
Lawmaker Proposes Criminal Liability for ‘Insult of Religious Feelings’
The parliamentary human rights committee decided to set up a working group for scrutinizing the draft law.
25 Apr.'18 17:21
New Abkhaz Government Head Appointed
Gennady Gagulia has served as the Abkhaz “prime minister” twice - in 1995-1997, and 2002-2003.
25 Apr.'18 14:43
Watchdog Improves Georgia’s Press Freedom Ranking
None of the countries of the former Soviet Union (except the Baltics) are ranked ahead of Georgia.

About Civil Georgia
Civil.Ge © 2001-2022, Daily News Online
Registered office: 2 Dolidze Str, 4-th Floor.
13