Revenue Service Granted with Inconceivable Rights

Revenue Service will play the role of private audit. This means that it will establish the market price of private property during the tax inspection. Experts state that this decision is one more control mechanism of businesses. Business should have opportunity to have a private audit determine the property price. Considering that the trust level of Revenue Service is too low, businessmen and experts do not believe that the service will evaluate the property according to the market price.

Newspaper Rezonansi reported on the following in the article entitled “Revenue Service Granted with Inconceivable Rights/The fact that the Revenue Service will evaluate the taxpayer’s property independently lacks any logic and is an inconceivable decision.”

The changes were made to the decree of Finance Ministry on Confirmation of Provision of Revenue Service on Income of Legal Entity of Public Law. According to the amendments, the Audit Department of Revenue Service, within its competence will have to determine the market price of the property as well. The Finance Ministry believes that the businesses will not have a reason of distrust since the audit departments has the relevant qualification to direct the process well and correctly. Businessmen Association thinks that the businesses should have opportunity to independently decide who will evaluate whether the property the Revenue Service or private auditor. Also, the businessman should have right to double-check the inference of Revenue Service,” – the publication notes.

“According to one of the leaders of political party Industry Will Save Georgia Zurab Tkemaladze, it is absolutely unacceptable that the controlling body evaluates the property of taxpayer independently: “The fact that the Revenue Service will independently evaluate the taxpayer’s property lacks any logic and is an inconceivable decision. The rule of determination of market price is vague in itself and the Revenue Service often takes advantage of that. This issue needs clarity. There always is uncertainty around it. Granting such right to Revenue Service is absolutely inconceivable,” – Tkemaladze states who says that the neutral service could have been created who could have established the value of businessman’s property and this function could have been added to the office of business Ombudsman,” – the publication adds.

“Expert Zviad Kandelaki also assesses the decision of Finance Ministry negatively. He notes that granting the controller with the right to determine the property value can happen only in Georgia: “Imagine, Revenue Service has a dispute with me as a businessman, confiscates my property and determines the value of this property independently. This is inconceivable and is a certain racketing against the businesses. This does not happen anywhere else. And the government talks about improving the business environment and drawing investors after this?” – Zviad Kandelaki states. As we noted when Ministry made decision it was sure that the Revenue Service had such a rating that any taxpayer would trust it. But the reality is that Revenue Service turned into the biggest monster for businessman (especially small and average businesses).”

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