Minister of Finance Candidate on Tax Legislation

We will have one of the most liberal, flexible and effective legislations in terms of paying taxes, - the new Finance Minister Ivane Machavariani said at a joint sitting of parliamentary committees on Friday, noting that many important steps have been taken by the state in recent years to assist taxpayers.

Machavariani noted that about 67,000 taxpayers were freed from debt payment as of January 1, 2013, totaling GEL 3.4 billion, including private entrepreneurs.

“Such a move by the state came about for several reasons. One considered the difficult years for doing business. We know that many have been affected because business was at risk. The second factor was the August 2008 war, and the third, of course, was the fault of taxpayers themselves. For these reasons, the state has shown political will and these tax debts have been written off,” Machavariani said.

He once again spoke about the need to adopt an insolvency law in order to improve the business environment.

“We had very inflexible legislation in this regard that prevented companies from going through rehabilitation or bankruptcy. Today, this legislation is practically ready. We often boast about being ranked #6 in the World Bank's Doing Business ratings, but if you look at the details, you will find that we have one of the lowest scores because of the lack of solvency law. This is important both in terms of practical considerations and in strengthening our country's position in the ratings. We have discussed the document together with the Ministry of Justice and I think we will have one of the most liberal, flexible and effective legislations in this direction,” he said.

He also noted that while discussing the need to write off tax debts, the disadvantages should also be taken into consideration.

"These kinds of decisions also have negative consequences, such as lowering the tax culture and putting the honest taxpayer, paying taxes for years, in an unequal position. Consequently, this type of amnesty is not being discussed at this stage,” he said.

06 September 2019 17:52