Georgia - Market ChallengesGeorgia - Market Challenges
The Georgian government is working to reduce obstacles to doing business in Georgia. The government has reduced or eliminated the majority of tariffs, and depending on the type of goods, custom tariffs could be 0 percent, 5 percent, or 12 percent. The majority of imports are subject to an 18 percent value added tax (VAT) and some products, such as alcohol, tobacco and automobiles, are also subject to an excise tax. In May 2016, the Georgian parliament adopted changes to the country's income tax laws, which exempted undistributed, reinvested, or retained corporate profits from income profit taxation. The law entered into force on January 1, 2017. Other taxes are Income Tax (20 percent), Corporate Profit tax (15 percent), Dividends Income Tax (5 percent), and Property Tax (0.2-0.8 percent). Starting from 2019, an accumulative pension scheme entered into force, mandating employers make a two percent of employees’ salary contribution to the Pension Fund.
Companies have reported problems arising from a lack of judicial independence, inefficient decision making processes at the municipal level, shortcomings in the enforcement of intellectual property rights, lack of effective anti-trust policies, selective enforcement of economic laws, and difficulties resolving disputes over property rights.
Most business is conducted in Georgian, official laws and regulations are printed in Georgian, and products must be labeled in Georgian. However, many Georgians involved in international business speak English and the use of English is widespread.
Communications and marketing skills are still developing, and personal connections remain of great importance. The Prime Minister has prioritized education, and specifically, vocational education.
Consulting an attorney licensed to practice in Georgia is always advisable before any substantial business transaction.
While intellectual property rights legislation is quite advanced and the government signed an agreement with Microsoft in 2015 for the sale of Microsoft’s Genuine OS Licenses and Enterprise Licensing for all Georgian government workstations, adherence to and enforcement of intellectual property rights (IPR) remains uneven. As part of its commitment under its AA and DCFTA with the EU, Georgia is improving IPR enforcement and has made notable strides in public education as a first step in enforcement of international IPR standards.
Prepared by our U.S. Embassies abroad. With its network of 108 offices across the United States and in more than 75 countries, the U.S. Commercial Service of the U.S. Department of Commerce utilizes its global presence and international marketing expertise to help U.S. companies sell their products and services worldwide. Locate the U.S. Commercial Service trade specialist in the U.S. nearest you by visiting http://export.gov/usoffices.
Companies have reported problems arising from a lack of judicial independence, inefficient decision making processes at the municipal level, shortcomings in the enforcement of intellectual property rights, lack of effective anti-trust policies, selective enforcement of economic laws, and difficulties resolving disputes over property rights.
Most business is conducted in Georgian, official laws and regulations are printed in Georgian, and products must be labeled in Georgian. However, many Georgians involved in international business speak English and the use of English is widespread.
Communications and marketing skills are still developing, and personal connections remain of great importance. The Prime Minister has prioritized education, and specifically, vocational education.
Consulting an attorney licensed to practice in Georgia is always advisable before any substantial business transaction.
While intellectual property rights legislation is quite advanced and the government signed an agreement with Microsoft in 2015 for the sale of Microsoft’s Genuine OS Licenses and Enterprise Licensing for all Georgian government workstations, adherence to and enforcement of intellectual property rights (IPR) remains uneven. As part of its commitment under its AA and DCFTA with the EU, Georgia is improving IPR enforcement and has made notable strides in public education as a first step in enforcement of international IPR standards.
Prepared by our U.S. Embassies abroad. With its network of 108 offices across the United States and in more than 75 countries, the U.S. Commercial Service of the U.S. Department of Commerce utilizes its global presence and international marketing expertise to help U.S. companies sell their products and services worldwide. Locate the U.S. Commercial Service trade specialist in the U.S. nearest you by visiting http://export.gov/usoffices.