Georgia’s parliament is considering a bill to extend VAT exemptions for unfinished construction projects launched before August 8, 2008, by another four years, until January 1, 2033. The bill received initial support from the Budget and Finance Committee and is expected to be fast-tracked.
Under current legislation, the sale of real estate in these projects and related construction and installation services are exempt from VAT with the right to deduct input tax until January 1, 2029. The deadline was previously extended in late 2024.
According to the bill’s explanatory note, the extension would help developers involved in Tbilisi’s program to complete unfinished buildings and compensate affected residents. Developers need bank financing to fulfill their obligations, while a stable legal framework would help lenders provide loans and financial guarantees.
The extension could reduce state budget revenue from VAT but would not increase budget spending or create new financial obligations. The bill was prepared with the involvement of Tbilisi City Hall and initiated by Georgian Dream MPs.
