In 2018 in Georgia, according to preliminary data of the Statistics Office, there was a total of 1 232.4 Million USD invested from the foreign countries, the half of which – 550 Million USD comes from the so-called outsourcing countries.
Georgian legislation only recognizes 15 countries as the countries with the tax relief whereas by the tax code the additional 49 countries are considered as the regime of the tax relief.
The outsourcing countries are considered the territories where according to the legislation:
1) It is possible for the juridical person to exempt from the taxes of the profit;
2) For the profit received and/or distributed by the juridical person, there is no tax established for the profit, or, the profit rate in Georgia does not exceed the available 1/3 of the profit tax rate.
The activities of the juridical person registered in one of the outsourcing zones, just as in other countries of the world, is allowed in Georgia and stands in accordance with the legislation. Each year, various countries of the world receive the investments worth of a couple of million dollars from the outsourcing zones.
It has been several years since FRANKSTON INTERNATIONAL registered in Panama Outsourcing is named as Georgia’s largest foreign investment company. The company is owned by Bidzina Ivanishvili. In 2018, according to GeoStat, there was a total of 74.7 million USD foreign direct investment from Panama. All of these investments are related to Bidzina Ivanishvili’s companies, especially to the ‘Tourism Development Fund’. Turns out that not only is the largest foreign investment company under the ownership of a Georgian citizen, but its share also reaches 6% of the whole FDI.
10 outsourcing countries which Georgia received the most investments from in 2018:
• Panama – $74.7 Million
• Luxembourg – $48.4 Million
• United Arab Emirates – $20.3 Million
• Hong Kong – $6.2 Million
• Belize – $5.2 Million
• Cayman Islands – $5.6 Million
• Saint Kitts and Nevis – $4.9 Million
• Seychelles – $3 Million
• Lichtenstein – $1.6 Million
• Marshall Islands – $1.2 Million