The Georgian government has approved a plan to ease the tax burden on businesses, hoping that the reform will help speed up economic growth.
Finance Minister Nodar Khaduri said February 12 that the reform would "speed up growth” but would reduce this year's targeted budget revenues by $160 million.
The planned budget cuts would come "mostly at the expense of reducing administrative expenditures," he added.
The plan, which still has to be endorsed by lawmakers, envisages scratching a 15 percent corporate income tax on reinvested or retained profit, as well as VAT on certain conditions.
The proposal, however, would not apply to banks, insurance companies, and microfinance institutions.
Opposition parties in Georgia have criticized the government's handling of the economy.
According to official data, Georgia’s gross economic product grew at an average 7 percent pace in 2004-2012 but expanded by only 2.8 percent last year, according to official data.