tax and customs administration of georgia - traceca azerbaijan georgia ... (russia) border crossing...
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17.04.2012
Baku, Azerbaijan
GEORGIA
Institutional Reforms in Georgian Customs
Tax and Customs Administration of Georgia
Tax Administra
tion
Customs Administration
Georgia Revenue Service
2007
SPS Control
2006
passport control (drivers of lorries)
2010
Georgia Revenue Service
Director General
Deputy Director General
Customs Clearance
Department
Tax Prevention Department
Dispute Resolution
Department
Legal Department
Service Department
Customs Border Protection
Department
Audit Department
Administration Department
HR Department
IT Center
International Relations
Department
Public Relations and Marketing
Department
CCZ land and railway BCPs
BCPs on the occupied territories airport BCPs
Sea Port BCPs future BCP
BATUMI SEA PORT
POTI SEA
PORT
Vale
SADAKHLO
RED BRIDGE
MTKVARI GARDABANI
LAGODEEKHI
SARPI
BATUMI
AIRPORT
NINOTSMINDA
GUGUTI
AIRPORT TBILISI
KAZBEGI
Kartsakhi
AIRPORT KUTAISI
AKHKERPI SAMTATSKARO
KULEVI SENAKI
GANTIADI
ROKI
Institutional Reform
Past
Customs Department of the Ministry of Finance of Georgia
Border Police of the Ministry of Internal Affairs of Georgia
Phyto-sanitary Service of the Ministry of Agriculture of Georgia
Veterinary Service of the Ministry of Agriculture of Georgia
Transport Administration of the Ministry of Transport
Customs Broker
Cargo Carrier
Insurance Company
Today
Patrol Police
Revenue Service
Control System
Past
100 % control
“Blind Control”
No risk analysis or assessment
8 Different agencies on the border
Today
Relevant Access to the database of
1) Patrol Police
2) Public Service Hall
Risk management system
Risk profiles
Random selection
Tomorrow
Joint use of BCPs
Turkey
Armenia
Azerbaijan
Ukraine
•National Agency of Public
Registry
•Civil Registry •Notary Chamber of
Georgia
Border Crossing Points
Sarpi BCP
Smooth running of goods
Single window principle
Presenting the documents and passport control without leaving the transport means
Vale BCP
Red channel (Physical inspection)
Yellow channel (Documentary check)
Green Channel
(No prerelease check)
Blue Channel (post clearance audit)
’’ASYCUDA”
Automated System of Customs Data
Risk Criteria Random Selection Module
ASYCUDA World
Customs Reforms Customs duty
Before 2007
(16)
12% 14% 15%
16% 17% 18%
20% 25% 30%
5% 6% 7%
8% 10%
4% 0%
After 2007
12%
5%
0%
Tariff lines
• 1 503 −12% ad valorem
• 229 − 5% ad valorem
• 466 – specific
• 8 410 - 0%
14.19% 2.16%
4.21%
79.42%
In total 10 608
12%
5%
specific
0%
Customs Reforms
• Before 2005
import and export
procedures
required
54 documents
• In 2009-2010
import and export
procedures
required
4 documents
• Since 2011 import
and export procedures
required
2 documents
According to the legislation economic agent is authorised to
submit the bill of lading and invoice either electronically or on paper basis; both forms are
equally acceptable
Customs Reforms
• Special VAT Regime
• Golden List
• Unified personal tax and customs liability account
• Clearance and registration of transport means in accordance with single window principle
• Tracker 7 – automated system of issuing licenses/permits in accordance with single window principle
• Creation of Customs Clearance Zones
• Authority of issuing permits related to customs procedures
• Certificate of origin
• Simplified export procedures
Before Creation of Customs Clearance Zones
Border Crossing
Point
15 – 30
minutes
Warehouse
1 -2
hour
Bank for
Payment
30 minutes
–
hour
Broker
For
Declaration
45 minutes
-
hour
Clearance
Service Center
10-30
minutes
Examination
(in case of red
corridor)
2 – 3
days
Warehouse
(in case of red
corridor)
30 minutes
Clearance Service Center
10-30
minutes
Warehouse
30 minutes
Release of goods
After Creation Customs Clearance Zones
Border Crossing Points
In case of standard procedures – in average 15 minutes
In case of red corridor – average 45 minutes
Advance Declaration Case
In case of green corridor - average 5 minutes (passport data registration control and customs procedures)
Customs
Clearance Zones
In case of standard procedures – in average 15 minutes
In case of red corridor - up to 1 hour
Payment of Customs Duty, Import VAT and Import Excise can be deferred for 5 days In case of advance declaration Customs Duty, Import VAT and Import Excise can be deferred for 15 days
Customs Clearance Zones
Cargo Clearance
Different options for cargo clearance
5 ways
Commodity Expertise
Bank Services
X-ray detection
Free Parking
Barcode instead of seal
Declaration in English for
foreigners
5 options for cargo clearance
Physical submission of B/L and invoice to the Customs Clearance Zone (CCZ) where the goods being subject to customs clearance are located. The officer will finalize the clearance process at the CCZ. The payment of import duties and taxes can be deferred for a period of 5 days
Electronic submission of customs declaration and supporting documents by economic agent accessing ASYCUDA system, by that time the goods being subject to customs clearance are located at CCZ. The officer will finalize the clearance process at the CCZ; In case of advance declaration the payment of import duties and taxes can be deferred for a period of 15 days
Advance electronic submission of B/L and invoice. Economic agent will electronically submit B/L and invoice via www.rs.ge before the goods, being subject to customs clearance, will enter the customs territory of Georgia. Customs officer of Border Crossing Point (BCP) will finalize the clearance process at the BCP. The payment of import duties and taxes can be deferred for a period of 5 days after the finalization of the clearance
Using electronic signature economic agent can submit B/L and invoice at the "A" CCZ by that time the goods are located in the "B" CCZ (“distant declaration"), while having in result saving of time and avoiding the travelling from one part of region to the other part of region within the customs territory of the Country. The payment of import duties and taxes can be deferred for a period of 5 days
Local clearance - Possibility of local clearance of goods has been introduced (economic agent can clear goods at its warehouse), this procedure may be conducted with three options. The payment of import duties and taxes can be deferred for a period of 5 days
Local Clearance
Electronic submission of customs declaration and supporting documents by economic agent accessing ASYCUDA system, CCZ officer will visit the economic agent’s premise in case of declaration will be rerouted by the risk module of ASYCUDA into red line (physical and documentary control)
Economic agent will submit B/L and invoice via www.rs.ge, CCZ officer will visit the economic agent’s premise in case of declaration will be rerouted by the risk module of ASYCUDA into red line (physical and documentary control)
CCZ officer will visit the economic agent’s premise and Economic agent will physically submit B/L and invoice and officer will finalize the clearance at the economic agent’s premise
Export Procedures Before (Two step export procedures)
• Physical presentation of goods in the customs clearance unit (goods being the subject to clearance used to be presented in the customs warehouse)
• Declaration used to be presented in the clearance unit and if the deceleration used to be rerouted by the risk module of ASYCUDA into red line, the goods used to be transferred to the warehouse for the physical control
• After the clearance procedure customs officer used to seal, insert the information about sealing into the declaration and issue the internal transit document (similar to T1)
• The integrity of seals was checked at the Border Crossing point while comparing it to the seal items mentioned in the declaration
Simplified Export Procedure
Physical submission of B/L and invoice to the Customs Clearance Zone (CCZ) and givng the possibility to the econmic agent to present the goods in CCZ being the subjet to export. (this is the option for the economic agents who do not have the opportubity to keep the goods in their warehouses). In this case the sealing is conducted by CCZ;
Electronic submission of customs declaration and supporting documents by economic agent accessing ASYCUDA system. The economic agent can obtain a number of customs seals at once while giving them the possibility to seal lorries themselves. Customs officer of Border Crossing Point (BCP) will finalize the clearance process at the BCP, the integrity of the seals will be checked at the exit point of Georgia
Advance electronic submission of B/L and invoice. Economic agent will electronically submit B/L and invoice via www.rs.ge before the goods. The economic agent can obtain a number of customs seals at once while giving them the possibility to seal lorries themselves. Customs officer of Border Crossing Point (BCP) will finalize the clearance process at the BCP, the integrity of the seals will be checked at the exit point of Georgia
•No physical presentation of goods in the internal customs clearance unit •Exemption from customs duties •0% of VAT •Clearance of goods in accordance with the three options:
Integrity Policy
Customs officers’ and brokers’ “institute of friendship bribery”
Overlapping of responsibilities - “bribery chain”
I step
Customs Code - general provisions lacing the detailed customs procedural manuals
recruitment of staff - non-transparent having in result inexperienced and uneducated staff
Discretion policy
Customs - bastion of corruption
I I step
In 2006 the new Customs Code
brutal reality conveying in itself the fighting against the corruption and the detection of corruption schemes, eradication of crime and punishment
modernised system: the new Customs Code with the corresponding secondary legislations providing with the detailed customs procedures
Customs duties – elimination of 16 customs duty dates, replacing them with a zero rate for 79. 42% of imports and two other rates (5 percent and 12 percent)
unhealthy environment for the business sector important obstacles for the business sector - the absence of advance ruling practice
Border control- Georgia Revenue Service and Border Police (Border Police later replace by Patrol Police)
non-existence of the qualified staff
intensive searches, inspections, and passport checks - this strict approach created frictions that eventually led to confrontations.
I I I step
Consolidation of Primary Legislation
fair, simple and reliable customs system:
Electronic administration system
TRACKER 7 and integrated tariff
personal tax and customs liability account
Modern infrastructure
Simplified customs procedures and target customs control
Liberalized trade
First generation of non-corrupted customs officers 24 hours supporting toll free