Businesses worldwide are mostly wary of the twin challenges of rising competition and taxes. The former can be addressed by improving the quality of products, delivery of service, and communicating about the same to the target customers. It is only the latter, the taxes, that can really cut into the profits of businesses. In most countries, businesses are considered the cash cow to be milked to meet the fiscal targets. In fact, giving a level playing field to businesses seems alien to most governments. Businesses too, in order to survive in such environments, have no alternative but resort to crony capitalism. In case, you too have to operate in such a stifling tax regime then it is time to look at opening an offshore account in Georgia or setting up a company in Georgia.
Why should Georgia be your destination?
As one of the important countries belonging to the Commonwealth of Independent States, Georgia is known for providing a liberal business environment. It comes with an assortment of benefits for businesses such as.
A low tax regime especially if you operate out of the free zones
Visa free regime to facilitate trade with EU
Less ordeal to face when it comes to obtaining licenses and permits
Transparency in the conduct of business
Liberalized currency control regime
To facilitate the setting up of businesses, Georgia has set up free zones in three strategic locations of the country. These are the port city of Poti, the capital city of Tbilisi, and the third largest city Kutaisi. The best part of setting up a company in the free zone of Georgia is being able to avail a slew of advantages. These are quick incorporation procedures, less or no VAT/customs duties on goods produced, freedom to repatriate capital, full currency convertibility, and a flexible employer-employee relation, among others.
Let us discuss the free zones in Georgia in some detail.
Poti Free Industrial Zone (FIZ): This particular zone was established by the UAE RAK Investment Authority and is situated by the Black Sea port. The zone has businesses from a host of domains such as steel, manufacturing, logistics, chemical, and processing. Besides providing access by sea, railroad and roadways, Poti FIZ offers operational advantages such as exemption from corporate taxes, customs duties, low cost of transport, low labour cost, and quick incorporation procedures among others.
Kutaisi Free Industrial Zone: It consists of two zones – Kutaisi and Hualing where the two have been set up in 2009 and 2015 respectively. Kutaisi is mostly known for the manufacture of home appliances and is poised to become a large industrial centre. Hualing FIZ is of recent origin and is known for companies that specialize in stone processing, metal, and furniture etc. The companies here enjoy benefits like the ones in Poti such as low production cost (read ready made infrastructure,) flexible labour laws, no monitoring by the local or state authorities etc.
Tbilisi Free Industrial Zone: The FIZ in the capital city of Georgia offers ready made facilities like offices, warehouses, and utilities etc. Companies looking to set up their infrastructure here can leverage the large pool of skilled human resource, responsive facility management services, quick incorporation procedure etc.
Setting up a company in one of the free zones in Georgia can be beneficial for businesses. The myriad benefits can keep you ahead in terms of competition and offsetting taxes at home.