The chairman of the Association, Shorena Kopaleishvili, addressed several questions to the head of the Revenue Service, Levan Kakava

As it is already known, the Revenue Service has issued a methodical reference on taxation of the profit of a person in the virtual zone, which is somewhat vague.

Therefore, the chairman of the Association, Shorena Kopaleishvili, addressed several questions to the head of the Revenue Service, Levan Kakava for the clarification.

We offer a brief summary of the questions:

• If the methodical reference has a retroactive force?

• Is it necessary for the founder (s) to be permanently and/or temporarily in Georgia?

• In order to use the tax benefits, what is meant by other factual circumstances, except for the employment of local staff ?

• Please indicate the source that should guide the business in determining the remuneration in the Georgian labor market?

• Is it mandatory to hire employees of different profiles and/or to rent/lease a permanent workplace in Georgia?

• Can receiving services abroad become a basis for tax exemption?

• How to determine the share of work received from non-residents and at the same time maintain the tax benefit?

• Will it be considered that a person of the virtual zone creates information technologies on the territory of Georgia?

• If a person of the virtual zone receives services for the creation of information technologies in Georgia, is it considered that the information technology product is created on the territory of Georgia?

• If the company no longer needs to hire people working in the profile field, will the tax exemption be applied only to the remuneration of staff hired?

• Is it fair that companies created the product before the status is granted will not be eligible for a profit tax exemption?

• Some service providers do not yet exist in Georgia. How does the tax methodology determine the location of the IT product in this case?

• Can a company receive a fee on its profit-sharing portion over the next few years without any development costs?

• How should a fined company with the status of a virtual zone person act if it meets the benefits according to the methodical reference?

• If the company with the status of virtual zone receive the IT service from local Legal entities or/and individual entrepreneur, will it be considered that the enterprise uses the work of a person (s) hired in Georgia with a relevant profile?

Please let us know what question you would like to ask the Head of the Revenue Service regarding this issue? We value your opinions.