On May 7, Friday, 14:00pm the Open Society Georgia Foundation together with group of civil society organizations calls for a round-table discussion with the participation of government authorities, decision-makers, broadcasters, NGOs and other interested parties to shed light on situation regarding tax amnesty for TV channels and make the decision-making process more transparent and inclusive.
Background information
During his annual speech to the Parliament on February 26, 2010, speaking about the media freedom President Saakashvili stressed that media freedom and pluralism is the foundation for democratic progress and it is very important that all TV channels, regardless of their size and position, broadcast without any obstacles. According to president Saakashvili, due to small size of the Georgian advertising market and limited financial resources almost all private TV channels exist in a difficult financial context and heavy tax debts and this is especially true for small regional TV channels. Further on, he brought an example of Regional Adjara TV station “25 Channel” which was nearly closed due to tax burden. President underscored that for the sake of the development of Georgian democracy, it is unacceptable for TV channels to be closed because they do not have enough money. Thus, based on example of tax relief and restructuring for “25 Channel” he proposed a new initiative envisaging tax amnesty to TV stations.
The given proposal led to confusion and different interpretations. According to some sources, president offered tax amnesty only for regional TV stations; however, others argue that president meant all Georgian TV channels, whether regional or national.
President initiative was followed by legislative initiative of the government that envisages tax amnesty for all those TV stations throughout the country, which currently owe unpaid taxes. The government says that total sum of unpaid taxes, plus fines imposed for a failure to pay taxes by the stations amounts to “about GEL 36 million”.
At the same time, Christian-Democratic Movement has submitted to the parliament another legislative initiative on the same matter, but it envisages tax amnesty only for the regional television stations, not covering the Tbilisi-based broadcasters.
Those two initiatives caused confusion in public and raised question: only regional TVs should be given tax amnesty or all broadcasters including Tbilisi based ones.
Another problematic issue is that government does not provide breakdown of amount of unpaid taxes per individual television stations, or number and names of those broadcasters, which owe the state. Following the request on detailed information, government brings forward article 122 of the tax code, according to which such information is a commercial secret of a company. However, one of the Georgian NGO “Georgian Young Lawyers’ Association” (GYLA) says that there were cases in the past when such information was made public, when a debt was written off from certain enterprises. GYLA recommends the Parliament to amend the draft and provide taxpayers with detailed information on amount of debt of each broadcaster.