Finance Minister, Nodar Khaduri, announced on August 7 about planned amendments to the tax code, which, he said, aim at “fostering export” and “further improvement of business climate.”
In one of the proposed amendments, the Finance Minister said, value added tax will be exempted from services provided in the process of manufacturing goods in which imported materials are used and in which end products are intended for export.
“Deep and comprehensive free trade agreement with the EU allows us to encourage operations of such enterprises in Georgia so we propose to exempt this process from value added tax,” Khaduri said.
The Finance Ministry did not provide a figure of how much is collected annually from this type of value added tax.
Initiative also envisages writing off fines imposed before January, 2013 on individual entrepreneurs for violating rules of use of cash registers.
Proposal also involves writing off unpaid taxes accumulated before January, 2005 by those taxpayers, who have had no business activity since that date, as well as writing off penalties on unpaid taxes since January, 2009 if since that date a taxpayer has had no business activity.
The sum, expected to be written off in unpaid taxes and penalties as a result of this initiative, is about GEL 8 million, according to the Finance Ministry.
The proposal also involves rescheduling for one year repaying taxes for those taxpayers, whose unpaid taxes does not exceed GEL 5,000; such taxpayers will not be required to provide collateral for rescheduling.