“Forbes Week” with Giorgi Isakadze on Challenges of Virtual Zone Status Companies
“Forbes Week” with Giorgi Isakadze on Challenges of Virtual Zone Status Companies
The unfair actions of the Revenue Service against the companies with the status of a virtual zone were covered in the program “Forbes Week”, where the chairman of the Association of Georgian Virtual Zone Persons, Shorena Kopaleishvili, was invited.
Over the past 10 years, more than a thousand legal entities have been registered in Georgia with a Virtual Zone status. According to the tax practice, the companies were not required to have employees directly in Georgia and to provide services directly from the territory of Georgia. However, from 2021 the Revenue Service has radically changed its tax practice – companies have been fined and demanded to pay corporate tax on income earned in previous years.
According to the cases only submitted to the association, the amount of fines exceeds 4-5 million GEL.
The Association of Georgian Virtual Zone Persons is actively cooperating with various agencies and associations to address this issue, including the Business Ombudsman. The European Business Association is also aware of the problem.
According to Shorena Kopaleishvili, they are planning to organize additional meetings. Their main goal is to establish a dialogue with the state and achieve the abolition of fines accrued in the past.
