Today nobody disputes the importance of small business for the economy, and the Georgian government has decided to change a lot in this sector. The Ministry of Finance of the country is preparing draft law amendments to the law on accounting and auditing, which clarifies the concept of micro, small and medium-sized businesses, and simplifies accounting and tax audits. At the same time, the Georgian government supports increasing the limit according to which the business is considered to be micro, small or medium-sized.
In particular, companies with a turnover of up to 1 million laris per year (up to 30,000 businesses are considered), small – up to 10 million laris, and average – up to 50 million laris.
According to the head of the Center for Innovation Development of Enterprises, Tamaz Vashakidze, today microentrepreneur status can be received only by a private individual. The updated law may become possible for legal entities.
"Today’s valid limit is 30,000 laris. It is a very small amount. Divide 30,000 into 365 days, and you will see that it is less than the turnover of small shopping kiosks. This happens due to the fact that the laws are made by Georgian officials who know nothing about business. In a normal situation, officials should meet with stakeholders before making a law in order to understand problems, as well as how to solve them. They should consult the Association Agreement between Georgia and the EU and research European laws," the expert said.
‘‘According to world practice, the number of large companies is less than the small and medium-sized ones in normal countries, but they pay more to the budget. But small and medium-sized businesses to a greater extent bear the social and economic burden that is creating jobs. Therefore governments in all advanced countries express great care for small and medium-sized companies, creating all sorts of benefits so that they could start working and creating fresh employment,’’ Tamaz Vashakidze said.
According to him, direct copying of European laws won’t bring any results: "For example, in Europe a microbusiness is a company with more than 9 employees and a turnover above 2 million euros. Imagine a Georgia company from 9 people who can. Are there such companies with a turnover of 1 million laris? You won’t find a single company!"
‘‘The law should correspond to our realities, and the Ministry of Finance should explain that everything is done that way. But everything is done without the participation of entrepreneurs or civil society. Nobody is asked, and then it is argued that everything is not as it should be," Tamaz Vashakidze concluded.
