What taxes apply in Georgia

The taxes are a vitally important part of your business. If you do not want to miss anything about it, you can check which kind of taxes is valid in Georgia.

According to the Georgian legislation, there are statewide and local taxes.

Common state taxes are:
• Income tax,
• Profit tax,
• Value Added Tax (VAT),
• Excise tax,
• Import.

Income Tax

Income tax is a general-state tax that is paid by persons who receive income from sources in Georgia.
Taxable income is taxed at 20%, except for certain types of taxable income.
At what rate is the taxable income:

  • Salary – 20%
  • Dividends – 5%
  • Rates – 5%
  • Royalties – 20%
  • Royalties received by resident natural persons at 20%
  • Revenue from scrap and waste supply of ferrous and /or non-ferrous metals – by 3%.

The current taxes are payable to the sole proprietor by the annual tax of the previous reporting period, in the following order:

  • No later than May 15 – 25 percent
  • No later than July 15 – 25 percent
  • No later than September 15 – 25 percent
  • No later than December 15 – 25 percent

The latest information was updated on February 21, 2019.

Profit Tax

There is a monthly profit tax, which is mandatory for a permanent establishment, with the exception of commercial banks, credit connections, lenders, insurance, and microfinance organizations.
Profit tax is 15% and is calculated by dividing the taxpayer’s expense on 0.85.

The object of taxation X 15%
___________________________
0.85͖

The enterprise must file the income tax return with the tax authority on a monthly basis, no later than the 15th day of the reporting month. He must pay the existing tax at the same time.

Value Added Tax (VAT)

The VAT is paid by a person who is registered or obliged to register as the VAT payer. It is the indirect tax, a supplement to the price of the goods and/or services rendered. The VAT is payable by the importer at the time of purchase of the goods/services (at the time of import) at an increased price, but the product supplier (importer) is obliged to pay the budget.

  • The VAT taxpayer must submit a tax return to taxing authority during the reporting period, no later than the 15th day of the following month and pay it within the same deadline,
  • Anyone who is not registered as The VAT payer must pay the VAT accrued no later than the 15th of each month,
  • Imports of goods shall be paid in accordance with the rules for payment of import duties. The VAT is payable no later than 45 days after the goods are released.

Excise tax

Excise Goods is- Alcoholic Beverages, Tobacco products (excluding tobacco raw materials), Cars, Motorcycle, Petroleum gases and natural gas (except pipeline transport), Petroleum Products, Petroleum Distillates, Painted Petroleum Products, Biodiesel, Pyrolysis liquid product, Oils, other products of high temperature distilled from coal resins, Additives, solvents, antiseptics, Lubricants and supplies, and Fluids for use in electronic cigarettes.

According to the legislation in force in the country, the excise taxpayers should consider the followings:

  • Excise goods that are manufactured in the country,
  • Export/import of excise goods,
  • Supply natural gas condensate and/or natural gas transportation,
  • External economic activity is the supply of petroleum products or motor vehicles specified in certain codes of the National
  • Commodity Nomenclature,
  • Provide international call termination services received from a person on a mobile or fixed network.

The excise tax shall be paid no later than the 15th day of the month following the reporting period of the taxable transaction.

Import Tax

The import tax rates are- 5%,12%.
From the date of registration of the goods temporarily imported into the customs territory of Georgia, each full and partial calendar month shall be taxed at the rate of 3% of the sum that would have been paid on the day of the temporary importation.

Local tax
Property tax

Local taxes are levied by a representative body of local government within the rates set by the government of the country, the payment of which is obligatory on the territory of the local self-government unit.
The following property tax is applied to an individual:

  • Owned real estate
  • Yachts (boats)
  • Helicopters
  • Airplanes and motor vehicles specified in 8703 of the National Commodity Nomenclature of Foreign Economic Activity
  • Leased property from a non-resident

In case of economic activity, the assets, non-installed equipment, as well as leased property on its balance sheet.
The person must submit a declaration no later than the first of November. The tax is calculated on the basis of the declaration. A person will file a tax return if their family income exceeds 40,000 GEL in the previous year.