Several Amendments have been introduced lately to Georgia's Tax Code by the government, and all of them target the VAT. The CheckPoints' Shota Tkeshelashvili talked with Tax expert Gela Barshov from TP Solution to guide through the amendments and their impact on doing business in Georgia.
According to Barshov, the changes are significant as it's the highest scale changes ever made in the VAT regulations of Georgia.
"The new terms are introduced. A new taxable basis and new exemptions will be enforced from 2021. These are the changes that will affect most of the current companies operating in Georgia. The main reason for these changes is Georgia's obligation under the European Union Association agreement to harmonize VAT regulation to a similar law applicable in the European Union. As you know, the EU has a similar harmonized VAT rule, which EU countries follow. The rule is quite similar to every country's major rules with minor differences," - he says.
Barshov states that from 2021, Georgian regulations will be similar to EU regulations, contributing to easier trade between EU countries and Georgia.
When asked to positively or negatively assess these changes, an international and Georgian tax specialist Barshov declares that if we assume that 40 changes have been made based on quantitative analyses, at least 30 out of 40 will be positive for our business.
"Overall, the changes are very positive. However, it depends on the type of business. For some businesses, the changes will have a more negative effect, while most businesses will enjoy more benefits. For example, medicine and education fields have additional tax exemptions, which is very beneficial for them. Therefore the answer to your question is - it depends," - he says.
