The Ministry of Finance is working to abolish tax breaks for businesses.
Lasha Khutsishvili, the Minister of Finance, said at the parliament that his agency, with the involvement of USAID and IMF experts, was working to assess the effectiveness of each tax break, after which a decision would be made to cancel specific benefits.
Work on the assessment of tax breaks began during the previous Minister of Finance and has been continued for several months. In June, Deputy Finance Minister Giorgi Kakauridze told BMG that the amount of tax breaks was up to GEL 2 billion a year.
"Abolition of benefits is one of the priorities that the Ministry of Finance is working on and it is quite a time-consuming process.
We are working with USAID and the IMF to evaluate the effectiveness of each tax break, I think we will have a document framework, which will evaluate all tax breaks.
I share the view that tax breaks should be as specific as possible and as targeted as possible. All persons must not enjoy tax breaks, if they do not need them.
Last year we had a historically high budget deficit of 9%. Fiscal consolidation will not be possible at the expense of increasing taxes, therefore the most important direction that remains for consolidation is to work on tax incentives and also on expenditures," - said Lasha Khutsishvili.
According to the draft budget for 2022, the government plans to collect GEL 13.3 billion in taxes from businesses and the population. Consequently, without tax breaks, this amount would have been more than GEL 15 billion.
