Revenue Service Introduces Single Treasury Code for Tax Payment

The Ministry of Finance and Revenue Service (RS) of Georgia has presented a new tax payment simplification reform, whereby 125 treasury codes for tax payments reduced to 1. The aim of this is to eliminate the often expensive challenges with the treasury codes system and to improve the business-enabling environment within Georgia. The new reform will enter into force from January 1.

In the earlier tax payment system, taxpayers had to choose among 125 different treasury codes. Mistakes were often made when selecting codes, resulting in inaccurate transactions and complications for taxpayers. To move an amount from one account to another, companies had to run additional procedures in the Revenue Service that required time. Now, by simplifying tax administration, businesses will save time, money, and reduce their risk of acquiring penalties by mistakes being made. With the new initiative, tax payment transactions will decrease considerably as will the refund time for overpaid taxes.

Representatives of the Revenue Service noted that reform was much needed as the large volume of treasury codes created problems not only for taxpayers but also for RS employees. “Taxpayers will no longer be liable to specify the correct code, and in case of an error, to have to spend time and money fixing it,” said Deputy Minister of Finance and Director General of the Revenue Service of Georgia Giorgi Tabuashvili. “That will be the job of the RS now, with Revenue Service software ensuring that payments are distributed correctly, according to the declared liabilities.”

As a result of the reform, taxpayers will save about 500,000 GEL and the number of transactions will be reduced by 5000. VAT refund time will be reduced from three months to one month and RS staff will save 11,200 hours annually.

The tax payment simplification reform was supported by USAID and included technical assistance in legal drafting, modification of the IT system and training for RS employees. “Simplification and affordability of payment reform is crucial to the government, local residents and businessmen who are interested in the business construction in Georgia, which in total contributes to the economic growth of the country,” said USAID Mission Director, Douglas Ball.

Eka Karsaulidze