28.Oct .2020 12:15

Chamber of Commerce Urges the Government to introduce tax benefits for maritime sector

Chamber of Commerce Urges the Government to introduce tax benefits for maritime sector
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The Georgian Chamber of Commerce and Industry prepared a research. According to the document, government must introduce tax benefits in order to increase attractiveness of Georgia's maritime sector.

The benefits include exempting sailors from income tax, as well as imposing property and profit tax benefits for companies involved in the maritime sector.

The document says that it is impossible for Georgia to attract new operators without granting competitive benefits.

"It is a sad, that Georgia does not have medium or large ship owner, logistics or trade companies. The owners of Georgian-flagged vessels (except for small yachts and tugboats and yachts) are mostly foreign companies.

This is a major shortcoming due to the fact that the Tax Code of Georgia does not provide any benefits for individuals and legal entities employed in the maritime sector. Without this, it is impossible to talk seriously about the full use of maritime potential and the activities of shipping companies in Georgia.

In order to operate shipping companies (both locally based and foreign ones) from Georgia, it is necessary to introduce certain tax benefits.

However, ships can be operated from anywhere in the world virtually and there are numerous regions with relevant tax breaks (including in the EU), it is impossible for Georgia to compete with anyone without proper tax changes.

It should be noted that, according to the Tax Code in force until 2010, ships registered in Georgia (except private individuals’ yachts (boats)) were exempt from property tax. Such a privilege is no longer allowed under the current Code. Even exempt from property tax would be a serious benefit and incentive for the shipping companies.

The draft amendments to the Tax Code are prepared by the Georgian Chamber of Commerce and Industry, so we are waiting a response from the government,” reads the document.