Georgia Economy Overview

Currency

₾ Georgian lari (GEL)

Working hours

40 hours/week

Public/bank holidays

15 public holidays

Capital

Tbilisi

Languages

Georgian

Population

3.7 million

Minimum hourly salary

Public sector: 20 GEL per day
Private sector: 5 GEL to 10 GEL per hour

Tax year

1st Jan – 31st Dec

Date format

DD/MM/YYYY

Misclassification penalties

Penalties for misclassification in Georgia can include fines and the requirement to pay back taxes and contributions. Specific amounts can vary based on the severity and duration of the misclassification.

Fun fact

Georgia is home to some of the oldest wine-making traditions in the world. In fact, there is archaeological evidence of wine production dating back over 8,000 years.

When looking for countries to start your business in, one destination that stands out to many is Georgia. The country stands in a great spot as a unique link between Europe and Asia. This makes it a great place for businesses that want to grow as it attracts foreign investment.

Additionally, the Georgian government offers tax breaks and easier ways to register a business, among other things. Georgia’s economy is varied, with farmland, mining, and services all seeing big growth. The country’s dedication to digital innovation and technological progress makes it a desirable place for digital nomads and tech companies to live.

Georgia’s economy is diverse, with farming, manufacturing, technology, and services. Because the government encourages creativity, there is also a thriving startup environment, especially in the tech sector, which is helped by the country’s strong digital infrastructure.

Overview of Georgia's Economy

Georgia’s economy is diverse and evolving, with significant growth expected despite challenges. The Asian Development Bank (ADB) forecasts GDP growth of 4.5% in 2023 and 5% in 2024, driven by the services sector and sustainable development initiatives.

Economic Indicator 2023 Projection 2024 Projection
GDP Growth 4.5% 5%
Inflation 6% 4%
Investment Growth – 3.5%

Inflation, which was nearly 12% in 2022, is projected to fall to 6% in 2023 and 4% in 2024 due to tight monetary policy and improved supply chains. Investment, on the other hand, is expected to grow by 3.5% in 2024, indicating rising business confidence.

While Georgia has seen significant improvements in GDP per capita and poverty reduction over the past decade, challenges like an aging population, slow economic growth, and low-quality job creation remain a concern.

The economy is supported by three main sectors: agriculture, industry, and services. The services sector, especially tourism, is currently the most dynamic, contributing significantly to GDP and employment. Continued economic reforms and leveraging Georgia’s strategic location and resources are essential for sustained growth.

Taxes

Employer Tax: 2%

Pension plan

2%

Employee Tax: 20%

Pension plan

2%

Income tax

Income taxes in Georgia is taxed at a flat rate of 20%.

Steps for Forming a Business in Georgia

Incorporating a company in Georgia involves several straightforward steps, facilitated by the country’s business-friendly environment as well as the government’s desire to attract foreign direct investment (FDI).

1

Choose a Company Structure

The most common types of business entities are Limited Liability Company (LLC), Joint Stock Company (JSC), and Branch Office. LLCs are the most popular due to their flexibility and limited liability for shareholders.

2

Company Name Registration

Select a unique company name and check its availability. Register the name with the National Agency of Public Registry (NAPR). From there, prepare the necessary documents, including the company charter, shareholder agreement, and copies of shareholders’ and directors’ identification documents.

3

Submit Registration Application

Submit the registration application to the NAPR. This can be done online or in person. Required documents include the company charter, registration application form, and identification documents. The standard fee for registering a company with the National Agency of Public Registry (NAPR) is approximately GEL 100. However, expedited services cost more. 

4

Obtain a Tax Identification Number (TIN)

Upon successful registration, obtain a TIN from the Revenue Service of Georgia for tax purposes.

5

Open a Bank Account

Open a corporate bank account in Georgia. This is necessary for conducting business transactions and fulfilling capital requirements.

6

Register for VAT (if applicable)

If the company’s turnover exceeds GEL 100,000 annually, it must register for Value Added Tax (VAT) with the Revenue Service of Georgia.

7

Get the Business Licenses and Permits You Need

Depending on the type of business you run, you may need different federal, state, and local permits to do so in Georgia properly.

8

Annual Registration and Maintenance

Every year, between January 1 and April 1, Georgia companies must file an annual registration with the state. This is where they tell the state about major organizational changes or contact information.

Alternatives to Company Incorporation in Georgia

In Georgia, businesses seeking to simplify their market entry can consider alternatives to traditional incorporation.

Professional Employer Organizations (PEOs) and Employer of Record (EOR) services provide effective solutions for hiring employees, managing HR tasks, and expanding operations without the need to establish a formal legal entity within the country.

These services handle administrative and compliance responsibilities, allowing companies to focus on their core business activities while ensuring regulatory adherence.

Georgia Employer of Record (EOR)

The EOR model allows businesses to rapidly onboard and train employees in Georgia, sometimes in as little as 12 hours, without establishing a physical presence. 

By utilizing these services, companies can efficiently extend their reach into Georgia’s market, leveraging local expertise and resources without the burden of navigating the company formation’s legal and administrative complexities.

These alternatives provide a streamlined pathway for businesses to achieve their operational and growth objectives in Georgia, aligning with the country’s regulatory environment and labor market dynamics.

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Georgia Professional Employer Organization (PEO)

PEOs in Georgia provide comprehensive HR solutions that cover employee wages and benefits management, HR compliance, risk management, and more.

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Exploring Opportunities in Georgia

Georgia offers a highly favorable environment for business, characterized by its strategic location, pro-business regulatory framework, and diverse economic sectors. The country’s simplified incorporation process, combined with attractive tax incentives, makes it an appealing destination for foreign investment. 

The country’s focus on economic reforms, sustainable development, and leveraging its natural resources has created a conducive ecosystem for businesses to thrive.

Business OpportunityReason
Tourism and HospitalityRich cultural heritage, diverse landscapes, government initiatives to boost the sector.
Agriculture and AgribusinessFertile land, favorable climate, increasing demand for high-quality agricultural products.
Renewable EnergyAbundant hydropower resources, government support, growing demand for clean energy.
Technology and InnovationSkilled workforce, competitive labor costs, supportive government policies.
Transport and LogisticsStrategic location, ongoing infrastructure development, growing trade volumes.

Georgia offers significant opportunities across various sectors due to its rich cultural heritage, diverse landscapes, and government-backed tourism initiatives.

With its business-friendly environment, stable political climate, and economic reforms, Georgia is an attractive destination for investors and businesses looking to expand in the Caucasus region.