The following coverage of the problem was made in Business Formula on the leading television.
The chairman of the Association, Shorena Kopaleishvili was also invited to the program. She spoke about the existing problems, as well as about the meeting with the representatives of the Business Ombudsman office, where the importance of changing the approach was discussed.
The change in the tax approach for Virtual Zone Persons scares investors. More than70% of companies are in dispute with the authority because of fines from the Revenue Service. Some of the investors dispute and say that Georgia is no longer a business-friendly country.
Despite the fact that under the legislation the Persons of the Virtual Zone were exempt from additional cost and profit tax, the Revenue Service has been asking them for tax for a year. Moreover, companies are also asked for a back date, i.e. tax for the previous years. According to the Association of the Virtual Zone Persons, 70% of companies have a dispute with the Revenue Service. According to the information provided by the Association, one of the European companies left the Georgian market two days ago. The business formula did not have direct communication with the investor, because as the Association states, he is still in dispute with the Revenue Service and does not want identification.
Over the past 11 years, more than a thousand legal companies have registered with the status of the Virtual Zone in Georgia. According to tax practice, companies are not required to have employees in Georgia or to provide services directly from the territory of Georgia. Nevertheless, companies are fined for not having Georgian employees or not working from Georgia.
Meanwhile, as the Association of the Virtual Zone Persons states, the government does not realize its actions and this approach damages the image of the country. At the same time, the Government gives promises to become a technology hub.
