Decrease in tax income
By Messenger Staff
Thursday, June 18The 2009 budget revenues have decreased and therefore the budget will need to be cut. However the Ministry of Finance excludes the option of doing this, planning to recover the deficit through accruing non-tax incomes.
Former Minister of Finance under Saakashvili Lekso Aleksishvili stresses that this situation is very serious. “The major indicator of economic growth is direct foreign investments, which have stopped,” states Aleksishvili. This might force many medium-sized and small enterprises to shut down and lead to job losses in so far prosperous segments of the economy such as real estate and banking. A further trade deficit is also envisaged.
Business is demanding tax benefits from the state. If big companies still function, though at a low level, small enterprises such as stores and cafes are closing down daily.
Analysts assess that business activity in Georgia has decreased 50%. The advertising market is also diminishing radically.