Significant changes are being proposed to the Georgian Tax Code, currently under review by the Finance and Budget Committee. According to the explanatory note, the amendments are bound by the need for tighter regulation of the gambling and tobacco industries.
The draft legislation stipulates that companies holding online gambling licenses will experience an increase in their profit tax, rising from the current 15% to 20%.
The explanatory note states, “By the draft law, the taxable income generated by an individual from operating a gambling machine salon and/or conducting gambling games in an electronic format—excluding the taxable income derived from the participation of foreign citizens in electronic gambling —will be taxed at a rate of 20% instead of the previous 15%.”
In addition to changes in the gambling sector, excise tax rates on certain tobacco products will also be elevated. Specifically, the excise tax on a pack of cigarettes will increase by 20 tetri, from GEL 1.70 to GEL 1.90. Likewise, the excise tax on heated tobacco products will rise by 15 tetri to GEL 1.85.
“The excise tax rates on certain tobacco products will be adjusted by 15 to 20 tetri, resulting in a rate of GEL 1.90 for 20 cigarettes, GEL 2.10 for a cigar, GEL 2.40 for 20 cigarillos, and GEL 1.85 for 20 units of heated tobacco products,” the document notes.
According to the explanatory note for the draft law, the anticipated changes in the gambling sector are expected to generate an additional GEL 115 million for the budget. Furthermore, the excise taxes on cigarettes are projected to contribute nearly GEL 77 million to the country’s main treasury.
