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EBRD: Government should Cut Expenses or Set New Taxes

Government of Georgia should either cut expenses or introduce new taxes to replenish expected budget deficit in 2017, Bruno Balvanera, the EBRD director in South Caucasus, Moldova and Belarus, told eugeorgia.info.

Government plans to remove profits tax to incentivize inflow of investments. At the same time, alternative sources of revenues are required, he noted.

“Naturally, financial resources are required for financing infrastructural projects. I know about certain restrictions in growth in taxes, but there are alternative variants too, for example, taxing vehicles and similar products – this will improve ecological conditions too. Even more so there is one of the most liberal environment in Georgia, why not?!” Bruno Balvanera said.

The EBRD representative refrained from providing more detailed recommendations, but pointed out that in December the international finance institution will publish economic condition improvement action plan.

In October 2016 International Monetary Fund IIMF) published economic forecast and determined the 2017 state budget deficit at 6%, that is the worst indicator in Caucasus and Central Asia Region.