Tax Code Amendments Proposed

Draft amendments to the tax code submitted to the Parliament for consideration envisage a “significant simplification” of the registration procedures for taxpayers, a decrease of the excise tax on tobacco, as well as number of initiatives aimed at boosting tourism and supporting the energy system in the country, the Georgian Finance Ministry reported on April 18.According to the amendments, starting from July 1, 2006 foreign citizens will be able to collect the value added tax (VAT) paid for goods purchased in Georgia from customs authorities. “The initiative aims at promoting tourism and export,” the Finance Ministry stated.The Ministry said that to support the energy sector VAT exemptions will be given for the import of materials and goods purchased under soft credits provided in frames of the rehabilitation of electricity facilities.VAT exemptions will also be provided for gas imported solely for generating electricity.The excise tax on imported tobacco will be reduced from the current 90 Tetri (49.4 cents) to 60 Tetri (32.9 cents) and on locally produced tobacco from the current 70 Tetri (38.4 cents) to 40 Tetri (21.9 cents), according to the draft amendments to the tax code.

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