Giorgi Papava, Lead Economist and Practice Head for private sector development policy at ISET Policy Institute, represented Georgia at the prestigious International Scientific Conference "Distributed Profit Taxation – Polish and worldwide perspective" on December 9, 2024, at the SGH Warsaw School of Economics in Poland.

The profit tax system that came into force on January 1, 2017, in Georgia aims to create a favorable business environment, accelerate economic growth, and improve tax administration. This system is based on the distributed profit taxation regime, similar to the one implemented in Estonia.

The Estonian model of Corporate Income Taxation (CIT) that came into force on January 1, 2017, in Georgia is based on the distributed profit taxation regime, according to which retained corporate income is tax-free, and profit is taxed at 15% only when distributed.

At the initiative of the Government of Georgia, a new model of corporate taxation was introduced in 2017. The so-called Estonian Model of Corporate Income Tax (CIT) reform envisaged a transition to a model wherein enterprises would only be taxed on profit distribution.

In 2016 reform to levy profit tax was carried out in Georgia to accelerate economic growth in the country, create a favorable environment for starting business and production, and tax administration. The reform envisaged transferring into the Estonian model of levying profit tax, resulting in levying enterprises with taxes during profit distribution.