The Parliament approved amendments to the Tax Code, with its first hearing on April 20, envisaging cancellation of the Tax Arbitration Councils, which are in charge of dealing with disputes between the tax-payers and the Finance Ministry.
These councils, which were set up for each individual case to solve the disputes between the tax-payers and the authorities, were seen by the business community as one of the most successful components of the new Tax Code, which was approved last December.
The government decided to cancel these councils, a decision that has been widely condemned by the business community, after the Finance Ministry lost a number of cases that resulted in the government re-paying several million Lari to a number of private firms.
“Currently there are several cases under consideration by the Arbitration Councils. The cases involve disputes over tens of millions of Lari. We should immediately take measures [against these councils], as we can not afford to re-pay tens of millions of Lari because of the unfair rulings of these councils,” Prime Minister Zurab Nogaideli told reporters earlier on April 20.
State Minister for Economic Reforms Kakha Bendukidze, who was the only member of the government who voiced concerns regarding the cancellation of the Tax Arbitration Councils, told reporters on April 20 that this decision will worsen the business environment in the country.
He added that this system of Tax Arbitration Councils needed improvements and not cancellation.
Chairman of the Georgian Business Federation, influential media and financial tycoon Badri Patarkatsishvili, issued a statement on April 20 also expressing concerns regarding the government’s decision.