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Georgia reveals details of Fourth Stage of Anti-Crisis Plan

Business Materials 1 December 2020 18:41 (UTC +04:00)
Georgia reveals details of Fourth Stage of Anti-Crisis Plan

BAKU, Azerbaijan, Dec.1

By Tamilla Mammadova – Trend:

The fourth Stage of the Anti-Crisis Plan Designed by the Government of Georgia, which includes a new package of government support to citizens and businesses, will remain targeted similar to the previous three stages, Trend reports via Georgian media.

The total budget of the Citizen Care Program is 545 million lari ($164.3 million), while the total number of beneficiaries is over 500,000 persons (numbers do not include the utility bill subsidies).

Utility bill subsidies will be valid for 4 months (from November through February) and the cost of power energy and natural gas (up to 200 kW/cubic meters) consumed by the population will be incurred from the State Budget. The probable number of beneficiaries will reach 1 million households. The initiative has been budgeted at 270 million lari ($81.4 million).

Social allowance in the value of 1,200 lari ($361.96) will be paid to individuals who have temporarily lost their jobs in the formal sector. The allowance will be paid for 6 months from January 2021 in monthly installments of 200 lari ($60.33). The probable number of beneficiaries is 125,000 persons and the initiative is budgeted at 150 million lari ($45.2 million).

Social allowance in the value of 300 lari ($90.49) will be paid to employees and sole traders who have suspended their operation in December and January due to the enforcement of additional restrictions. The probable number of beneficiaries is 100,000 persons and the initiative is budgeted at 30 million lari ($9.09 million).

Social allowance in the value of 600 lari ($180.98) will be paid to households with the subsistence rating scores in the range of 65,000 - 100,000 from January, payable in monthly installments of 100 lari ($) on average (depending on the number of people in a household) for 6 months. The probable number of beneficiaries is 72,000 households (about 220, 000 people) and the initiative is budgeted at 55 million lari ($16.5 million).

Social allowance in the value of 600 lari ($180.98) will be paid to households with the subsistence rating scores in the range of 0 to 100,000 and 3 or more children aged under 16, payable in monthly installments of 100 lari ($30.16) for a period of 6 months (January through June). The initiative is potentially applicable to 24,000 households and is budgeted at 15 million lari ($4.5 million).

Social allowance in the value of 600 lari will be paid to the disabled persons aged under 18 and adults with acute disabilities, payable in monthly installments of 100 lari for a period of 6 months. The potential number of beneficiaries is 43,000 persons and the initiative is budgeted at 27 million lari ($8.1 million).

Individuals employed at organizations that will suspend operations in December and January will be able to get their bank loan service payments deferred.

As for the business support package, which is budgeted at 515 million lari ($) in total, it includes the following:

- Personal income tax (PIT) will be waived from companies in the portion of 750 lari ($226.23) from a monthly salary of 1,500 lari ($452.45) payable to their staff in the period of December 2020 through May 2021.

- Potential number of beneficiaries is 33 000 companies and their 425,000 employees. The initiative has been budgeted at 260 million lari ($78l4 million).

- Property tax will be waived in the tourism sector (assets used in the operation of hotels, restaurants, and the like) in 2021. The initiative is budgeted at 45 million lari ($13.5 million);

- PIT for 4 months of the year deferred to December 1, 2020, will be waived in the tourism sector (hotels, restaurants, and the like). The initiative is budgeted at 20 million lari ($6.03 million);

Bank loan interest will be subsidized for hotels. The initiative will also apply to restaurants for 6 months. The potential number of beneficiaries is 3,700 companies;

The Micro-Grant Program will apply to thousands of new business projects (scheduled for 2020). The initiative is budgeted at 40 million lari ($12.06 million).

The Credit Guarantee Fund will be actively used in 2021, which will assist the private sector in restructuring the current borrowings and in soliciting new loans. The initiative is budgeted at 100 million lari ($30.1 million).

Companies that have suspended operations in December and January will be able to have their bank loans deferred.

Overall, the new support package is budgeted at 1.1 billion lari ($331.7 million).

In the opinion of the Head of Government of Georgia, the global economic crisis continues in 2021 and it will be quite challenging. Hence, the social and business support package of the government greatly covers citizens and companies that have suspended operation in the referred period and require support most of all. In addition, the Government of Georgia took a decision to subsidize the prime quality wheat flour, as a result of which the price of bread will not increase. The program will be valid for 4 months till March 31, 2021. The government will monitor the situation at international markets and will take applicable decisions on the grounds of global prices on wheat flour.

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