On Establishment of the Council of Dispute Resolution of the Revenue Service, the Approval of Its Rules of Operation, as well as the Procedures for the Mediation in the Audit, Customs and Tax Monitoring Departments

Order No 31275

of the Head of the Revenue Service

8 July 2013

Tbilisi

On Establishment of the Council of Dispute Resolution of the Revenue Service, the Approval of Its Rules of Operation, as well as the Procedures for the Mediation in the Audit, Customs and Tax Monitoring Departments

Order No 50444 of 5 December 2014 of the Head of Revenue Service  –  website, 10.12.2014

Order No 25212 of 13 July 2015 of the Head of Revenue Service  –  website, 17.7.2015

Order No 16415 of 23 May 2019 of the Head of Revenue Service  –  website, 24.5.2019

Based on subparagraph (f) of paragraph 2 of Article 37¹ of the Procedure for Selecting a Person to Exercise Tax Control, also the Procedure of Implementation of Tax Control, Conducting Procedures of the Current Control, Writing Off Commodity Material Values, Taking Measures to Ensure Payment of Tax Arrears, the Proceedings of Tax Violation approved by the Article 61 of the General Administrative Code of Georgia, the Order No 994 of 31 December 2010 of the Minister of Finance of Georgia and the subparagraphs (g), (o) and (t) of the paragraph 2 of the Article 3 of the Regulations of the Revenue Service approved by the Order No 303 of 23 May 2011 of the Minister of Finance of Georgia on Approval of Regulations of the Legal Entity under Public Law  –  the Revenue Service, I order:

1. A consultative body of the head of the Revenue Service  –  the Council of Dispute Resolution of the Revenue Service shall be established in the Revenue Service.

Order No 25212 of 13 July 2015 of the Head of Revenue Service  –  website, 17.7.2015

2. The composition of the Council of Dispute Resolution of the Revenue Service shall be defined in accordance with Annex No 1.

Order No 25212 of 13 July 2015 of the Head of Revenue Service  –  website, 17.7.2015

3. The following shall be approved:

a) the rules of the operation of the Council of Dispute Resolution of the Revenue Service  –  in accordance with Annex No 2;

b) the procedure for mediation in the Audit Department  –  in accordance with Annex No 3;

c) the notification form on the draft of tax inspection act  –  in accordance with Annex No 4;

d) the procedure for mediation in the Customs Department  –  in accordance with Annex No 5;

e) addresses for participation in the meeting of the Council through the means of electronic communication  –  Annex No 6.

f) application on the refusal to appeal the decision and recognition of the amount deposited on the temporary registration card of the taxpayer  –  Annex No 7;

g) the procedure for mediation in the Tax Monitoring Department – Annex No 8;

h) the notification form referring to the draft protocol drawn up on the results of the implementation of current control (inventory taking)  –  Annex No 9.

Order No 50444 of 5 December 2014 of the Head of Revenue Service  –  website, 10.12.2014

Order No 25212 of 13 July 2015 of the Head of Revenue Service  –  website, 17.7.2015

Order No 16415 of 23 May 2019 of the Head of Revenue Service  –  website, 24.5.2019

4. (Deleted  –  13.07.2015; No 25212).

Order No 25212 of 13 July 2015 of the Head of Revenue Service  –  website, 17.7.2015

5. Before this order comes into effect the Consultative Council of the Audit Department shall review and make a decision on the position submitted by the taxpayer on the draft inspection act in accordance with the procedure established by this order.

Order No 25212 of 13 July 2015 of the Head of Revenue Service  –  website, 17.7.2015

6. The following shall be declared invalid:

a) Order No 4830 of 26 March 2012 on the Approval of the Rules of Procedure of Revision in the Audit Department of the Position Submitted by the Taxpayer on the Results of Tax Inspection;

b) Order No 766 of 25 January 2012 of the Head of the Revenue Service on the Approval of the Rules of Procedure of Mediation council of the Revenue Service.

7. This order shall enter into force upon signing.

Head of the Service Lasha Khutsishvili

Annex No 1

Order No 7685 of 12 February 2014 of the Head of Revenue Service  –  website, 21.2.2014

Order No 8692 of 18 February 2014 of the Head of Revenue Service  –  website, 24.2.2014

Order No 13948 of 11 March 2014 of the Head of Revenue Service  –  website, 17.3.2014

 Order No 37198 of 18 August 2014 of the Head of Revenue Service  –  website, 19.9.2014

Order No 45785 of 5 November 2014 of the Head of Revenue Service  –  website, 14.11.2014

Order No 51439 of 11 December 2014 of the Head of Revenue Service  –  website, 16.12.2014

Order No 25212 of 13 July 2015 of the Head of Revenue Service  –  website, 17.7.2015

Order No 5476 of 2 March 2016 of the Head of Revenue Service  –  website, 4.3.2016

Order No 7857 of 24 March 2016 of the Head of Revenue Service  –  website, 29.3.2016

Order No 17164 of 26 June 2017 of the Head of Revenue Service  –  website, 6.7.2017

Order No 6305 of 23 March 2018 of the Head of Revenue Service  –  website, 27.3.2018

Order No 10157 of 30 April 2018 of the Head of Revenue Service  –  website, 12.6.2018

Order No 7107 of 25 March 2019 of the Head of Revenue Service  –  website, 22.5.2019

Order No 22195 of 3 July 2019 of the Head of Revenue Service  –  website, 5.7.2019

Order No 28952 of 19 August 2019 of the Head of Revenue Service  –  website, 22.8.2019 

The Composition of the Council of Dispute Resolution of the Revenue Service and Invited Specialists

Annex No 2

The Rules of Operation of the Council of Dispute Resolution of the Revenue Service

Order No 25212 of 13 July 2015 of the Head of Revenue Service  –  website, 17.7.2015

Order No 7107 of 25 March 2019 of the Head of Revenue Service  –  website, 22.5.2019

Article 1 – General Provisions

1. The work procedure ('the Procedure') of the Council of Dispute Resolution of the Revenue Service shall define the procedures for the revision of the issue and decision-making at the meeting of the Council of Dispute Resolution ('the Council') of the Revenue Service.

2. The Council is a consultative body of the head of the Revenue Service, which reviews complaints received at the Revenue Service, separate issues and develops recommendations in a collegial manner at the closed meeting.

2¹. The Council shall be authorised to invite experts, specialists, representatives of other administrative bodies (including, business ombudsman/deputy business ombudsman) and other relevant persons to the meeting.

3. (Deleted  –  13.7.2015; No 25212).

4. (Deleted  –  13.7.2015; No 25212).

5. The Department of Disputes of the Revenue Service ('the Department of Disputes') shall perform the functions of the executive office of the Council.

Order No 50444 of 5 December 2014 of the Head of Revenue Service  –  website, 10.12.2014

Order No 25212 of 13 July 2015 of the Head of Revenue Service  –  website, 17.7.2015

Article 2 – Preparing an issue for revision

1. The complaint submitted by the taxpayer to the Revenue Service shall be forwarded to the Department of Disputes for examination and revision.

2. The Department of Disputes shall send the complaint of the taxpayer along with the attached materials to the relevant structural unit of the Revenue Service to draw a deduction.

3. The relevant structural unit of the Revenue Service shall prepare a conclusion on the complaint of the taxpayer and send it to the Department of Disputes along with the relevant evidence.

4. The Department of Disputes, as well as the members of the Council shall have the right to contact the taxpayer and other persons to request additional information/documentation regarding the issues under revision.

5. If the revision of the complaint at the meeting of the Council is deemed expedient, after the expiration of the term for making a conclusion or the term indicated for making a conclusion, the Department of Disputes shall ensure preparing the issue for the revision by the Council, drawing up an agenda for the consecutive/nearest meeting of the Council and sending it to the members of the Council by e-mail. The agenda shall be agreed with the chairperson/deputy chairpersons of the Council.

6. The Department of Disputes shall notify the members of the Council and the taxpayer/its representative of the time and place of the meeting of the Council by available technical means (telephone, fax, e-mail, etc.).

7. The Department of Disputes shall notify the taxpayer that he/she may, if required, participate in the meeting of the Council through the electronic communication means from service centres indicated in Annex No 6.

Order No 25212 of 13 July 2015 of the Head of Revenue Service  –  website, 17.7.2015

Order No 7857 of 24 March 2016 of the Head of Revenue Service  –  website, 29.3.2016

Article 3 – Revision of an issue at the meeting of the Council

1. According to the priorities set out in this paragraph, during oral hearing the meeting of the Council shall be conducted and headed by:

a) the chairperson of the Council of Dispute Resolution of the Revenue Service;

b) one of the deputy chairpersons of the Council ofDispute Resolution of the Revenue Service;

c) the head of the Department of Disputes of the Revenue Service (a member of the Council of Dispute Resolution of the Revenue Service).

1¹. An employee of the Department of Disputes shall register decisions made at the meeting.

2. The Council shall be authorised if attended by the majority of its members.

3. On the initiative of the chairperson of the Council/one of the deputies or at the request of the taxpayer, the revision of the issue may be put on a back burner.

4. Taking into account the complex nature of the issue under revision, the Council shall be authorised to invite an expert/a specialist to the meeting, as well as other eligible persons. The invited specialist, expert and/or other eligible persons must maintain confidentiality of the taxpayer information. The Council meeting may be attended by the personal tax advisor of the taxpayer.

5. A speaker, a representative of the structural unit which receives/makes the disputable decision, shall present information on the issue under revision at the meeting of the Council, whereas a co-speaker shall be a relevant employee of the Department of Disputes.

6. The Council shall be authorised to suspend the revision of the issue and prior to the formation of the final assessment, request from the taxpayer, the relevant structural unit and/or other bodies/persons the conclusion, evidence and/or other information.

7. If the taxpayer submits an application on the conclusion of the tax agreement to the Revenue Service, the revision of the issue may be suspended until a decision on the conclusion of the tax agreement is made.

8. The Council shall approve/develop the position on the issue under revision by the majority of the members of the Council attending the meeting. It shall be prohibited to refrain from voting. Taking into account the complexity of the issue under revision, the decision of the Council may be agreed with the head of the Service.

9. The Council shall be authorised:

a) to satisfy the complaint;

b) to partly satisfy the complaint;

c) not to satisfy the complaint;

d) to leave the complaint without consideration;

e) to take an interim decision and suspend the revision of the complaint;

f) to make a decision by combining the contents of subparagraphs (a)  –  (d) of this paragraph;

g) to receive a recommendation on other issues indicated in the agenda.

10. The minutes of the meeting shall be drawn up on the course of the meeting of the Council, which shall be signed by the members of the Council, who participated in the revision of the issue. The chairperson/one of the deputy chairpersons of the Council and an employee of the executive office of the Council shall sign the minutes of the meeting.

11. The minutes of the meeting of the Council shall be binding upon the tax authority.

12. In accordance with the recommendation approved at the meeting of the Council regarding the reviewed complaint, the Department of Disputes shall ensure drafting an individual administrative and legal act of the Revenue Service and its submittal to the head of the Revenue Service/head of the Department of Disputes (in case of delegation).

13. (Deleted  –  13.7.2015; No 25212).

14. The individual administrative and legal act provided for by paragraph 12 of this article shall be enforced by the authorised official of the Revenue Service within 30 calendar days after its coming into force, except for the case when it cannot be enforced within the given term due to the objective factors.

15. To enforce the individual administrative and legal act of the Revenue Service, the responsible department shall submit information on the enforcement of the relevant act to the Department of Disputes no later than the 5th day of the month following the month of the enforcment of the act.

16. Information provided for by paragraph 15 of this article shall be submitted by the Department of Disputes to the head/deputy head of the Revenue Service until the 15th day of the month of receiving the information.

Order No 7685 of 12 February 2014 of the Head of Revenue Service  –  website, 21.2.2014

Order No 50444 of 5 December 2014 of the Head of Revenue Service  –  website, 10.12.2014

Order No 25212 of 13 July 2015 of the Head of Revenue Service  –  website, 17.7.2015

Order No 7857 of 24 March 2016 of the head of Revenue Service  –  website, 29.3.2016

Order No 12765 of 15 May 2017 of the head of RevenueService website, 16.5.2017

Order No 10157 of 30 April 2018 of the Head of Revenue Service  –  website, 12.6.2018

Order No 7107 of 25 March 2019 of the Head of Revenue Service  –  website, 22.5.2019

Article 4 – Submission of the application on the refusal by the taxpayer to appeal the decision of the dispute resolution authority

1. The taxpayer has the right to submit a application on the Recognition of Refusal to Appeal the Decision and the Recognition of the Amount Deposited in the Temporary Card of the Taxpayer to the authority having the competence to resolve a tax dispute personally or through a representative, with the aim of the recognition of refusal to appeal the decision of the authority having the competence to resolve a tax dispute and the recognition of the amount deposited in the temporary registration card of the taxpayer.

2. The taxpayer/its representative may submit application on the Recognition of Refusal to Appeal the Decision and the Recognition of the Amount Deposited in the Temporary Registration Card of the Taxpayer in written/electronic form in accordance with Annex No 7.

3. In the case of submission of a statement by the representative of the taxpayer, the statement must be accompanied by a document certifying representation.

Order No 22758 of 30 August 2017 of the Head of Revenue Service  –  website, 19.9.2017

Order No 2590 of 7 February 2018 of the Head of Revenue Service  –  website, 26.2.2018

Annex No 3

Procedure for Mediation in the Audit Department

Article 1 – General Provisions

1. The procedure for mediation in the Audit Department ('the procedure') shall define procedures for the revision of the written/electronic (submitted through www.rs.ge (through the taxpayer authorised page of the official website of the Revenue Service) position ('the taxpayer position') of the taxpayer and/or its representative ('the taxpayer') at the Consultative Council ('the Consultative Council') of the Audit Department with regard to the draft of inspection act ('the draft act') on the results of the tax inspection ('the tax inspection') conducted by the Audit Department of the Revenue Service.

2. The head of the Audit Department shall define the number and personal composition of the Consultative Council by an order.

3. The Consultative Council shall be chaired by the head of the Audit Department, in the case of its absence, one of the deputy heads of the Audit Department shall act as a chairperson of the Council.

4. The Mediation Division ('the Mediation Division') of the Audit Department shall ensure the organisation of the activities of the Consultative Council, preparation of the taxpayer positions ('the agenda') to be reviewed at the Consultative Council and systematisation of the protocols of review ('minutes of the meeting') in the written and/or electronic form.

5. The Consultative Council shall review the substantiated position of the taxpayer related to the draft act, by which he/she does not agree fully or partially (regarding the separate episodes of the draft act) with indication of the relevant basis and which was submitted to the Audit Department within the term of 10 days after submitting/receiving the notification and the draft act by the taxpayer.

6. The position of the taxpayer shall not be reviewed at the Consultative Council meeting (except for the cases provided for by Article 6 of this procedure), provided that one of the conditions given below is met:

a) the taxpayer position is submitted to the Audit Department in violation of the term defined by paragraph 5 of this article;

b) the written information of the taxpayer, which contains information on purpose of the position regarding the draft act or extension of the term of submission is provided and the particular term for its submittal is not indicated. Furthermore, the taxpayer position is not submitted to the Audit Department within the term provided for in paragraph 5 of this article;

c) the taxpayer position or the document attached to it is not drawn up in the official language of Georgia and a duly certified translation is not submitted either;

d) the taxpayer fully agrees with the draft act;

e) the taxpayer position has been submitted by an unauthorised person (in the case of submitting the taxpayer position in electronic form on www.rs.ge (through the authorised page of the taxpayer on the official website of the Revenue Service) it is considered that the taxpayer position has been submitted by an authorised person);

f) the taxpayer position has already been discussed at the Consultative Council meeting and/or a complaint regarding the same issue is reviewed/has been reviewed at the Council of Dispute Resolution of the Revenue Service/Council of Dispute Resolution under the Ministry of Finance of Georgia or the Council of Dispute Resolution of the Revenue Service made a protocol resolution on this issue;

g) (Deleted  –  13.7.2015; No 25212).

7. In the case of submitting various positions regarding the draft act by the taxpayer, the last position submitted prior to the expiration of the term defined by paragraph 5 of this article shall be subject to the review on merits at the Consultative Council, despite the existence of previous positions. The Consultative Council may also review the issues related to the draft act, which will be expressed by the taxpayer during the preliminary review of the issue and/or in the course of the Consultative Council meeting and which are not submitted in the written position of the taxpayer.

8. The taxpayer shall have the right to submit the taxpayer position regarding the draft act along with the relevant materials/evidence (if any) personally or through a representative within the term of 10 days after receiving the notification and draft act, in a written or electronic form (through www.rs.ge (through the taxpayer authorised page of the official website of the Revenue Service)), to the Audit Department or apply to the Audit Department with the request of the extension of the term of submitting the taxpayer position with the indication of the particular term and particular grounds.

9. The taxpayer position or the application on the extension of the term shall be deemed submitted even in case if it is handed over to the post-office within the term defined by paragraph 5 of this article or submitted to other structural units of the Revenue Service. Furthermore, the relevant structural unit of the Revenue Service shall immediately send the taxpayer position or an application on the extension of the term along with the attached materials (if any) to the Audit Department.

10. Based on the decision of the management of the Audit Department, the taxpayer shall have the right to attend the meeting of the Consultative Council personally and/or through a representative. Furthermore, if requested, the authorised representative shall, along with the position, submit a document proving the relevant powers to the Consultative Council.

11. A member of the Consultative Council, a taxpayer/representative and/or other invited person (if any) may participate in the Consultative Council meeting through electronic communication means (by video call).

12. The taxpayer position shall be reviewed at the Consultative Council, notwithstanding whether he/she participates in the review of an issue at the Consultative Council or not. If the taxpayer does not participate in the review of an issue at the meeting of the Consultative Council, the information at the Consultative Council shall be presented by an auditor performing tax inspection ('the auditor').

13. An auditor shall necessarily participate in the review of an issue at the meeting of the Consultative Council, including through electronic communication means (by means of a video call). Furthermore, in the case of the absence of an auditor, the head of the relevant division that conducts tax inspection shall participate in the meeting of the Consultative Council during the review of the issue.

14. Before issuing the tax request, based on the report drawn up on the results of the analysis of quality control by the Audit Department regarding the amending tax obligations defined by the draft act of the tax inspection, the taxpayer shall have the right to submit the taxpayer position which shall be reviewed by the Consultative Council of the Audit Department. The written position of the taxpayer shall be submitted within the term of 10 days after submitting draft act/conclusion drawn up on the basis of the results of the quality control analysis, notwithstanding whether the taxpayer agreed or not with the draft act/conclusion drawn up before the results of the quality control analysis were made. Furthermore, if the tax inspection draft act is subject to the quality control, in this case the mediation process shall start only on the results defined after the quality control.

Order No 56758 of 11 November 2013 of the Head of Revenue Service  –  website, 18.11.2013

Order No 40531 of 22 September 2014 of the Head of Revenue Service  –  website, 10.11.2014

Order No 25212 of 13 July 2015 of the Head of Revenue Service  –  website, 17.7.2015

Order No 38628 of 16 October 2015 of the Head of Revenue Service  –  website, 15.4.2016

Order No 30473 of 15 November 2017 of the Head of Revenue Service  –  website, 21.11.2017

Order No 17923 of 12 July 2018 of the Head of Revenue Service  –  website, 23.10.2018

Article 2 – Preparing the draft act and Audit Department notification and introducing them to the taxpayer

1. On the results of tax inspection the taxpayer shall be sent/handed the notification of the Audit Department in the written form/by electronic mail in the form of Annex No 4 and the draft act, as well as the materials (if any) which are the grounds for imposing taxes, fees and/or sanction ('the funds'), unless the introduction of them to the taxpayer is not subject to statutory restriction.

2. The taxpayer shall have the right before the expiry of the term defined by paragraph 5 of Article 1 of this procedure to apply to the Audit Department in order to get familiar with the accounting and/or initial tax documentation or their copies withdrawn from the taxpayer during tax inspection, which are required to prepare the taxpayer position regarding the draft act. The Audit Department shall introduce the requested documents to the taxpayer or hand over their copies. In this case the term for submission of the taxpayer position defined by paragraph 5 of Article 1 of this procedure shall be calculated from the date of introduction of the requested documentation to the taxpayer or handing over their copies.

3. An auditor shall draw up a draft act which shall substantially be agreed (in the part of the compliance of additional tax obligations to be imposed/reduced with the legislation) with the head of the relevant division conducting tax inspection. Furthermore, 'draft' shall be indicated at each page of the draft act and it shall not be verified by the signature of the auditor.

4. The notification and one copy of the draft act, as well as the relevant materials (if any) shall be handed over to the taxpayer:

a) by an auditor personally, and this shall be validated by the signature of the taxpayer and indication of the date on the second copy of the notification. Furthermore, the draft act agreement on the second copy of the notification shall be validated by the signature of the relevant head who conducts tax inspection. Information about handing over the documents to the taxpayer in an electronic form (by the means of document management software) shall be notified to the audit technical support division of the Audit Department ('the audit technical support division'), which carries out procedures provided for by subparagraph (c) of paragraph 5 of this article;

b) by the audit technical support division -on the basis of the memorandum of the head of the relevant division conducting tax inspection. In addition, the audit technical support division shall carry out procedures provided for by paragraph 5 of this article;

c) by the auditor through e-mail sent to the authorised electronic address of the taxpayer. The information in electronic form shall be introduced to the audit technical support division, which carries out the procedure provided for by subparagraph (c) of paragraph 5 of this article.

5. The audit technical support division, no later than 3 working days after receiving the draft act with the memorandum of the head of the relevant division conducting tax inspection, shall:

a) prepare a notification in accordance with the form approved by the head of the Revenue Service in two copies;

b) send one copy of the notification along with the draft act and relevant materials (if any) to the taxpayer by post or hand them over personally, and this shall be validated by the signature of the taxpayer on the second copy of the notification and indicating the date;

c) prepare the draft order of the authorised official of the Audit Department on suspending the tax inspection.

6. In cases provided for by paragraph 4 of this article information about sending/handing over the notification and the draft act to the taxpayer by the audit technical support division shall be notified to the mediation division (by the means of document management software).

7. After sending/handing over the notification and the draft act to the taxpayer, the term of submitting the taxpayer position to the Audit Department defined by paragraph 5 of Article 1 of this procedure shall be monitored by the audit technical support division.

8. In the case of failure to submit the taxpayer position or an application for the extension of the term within 10 days after handing over/introducing the notification and draft act by the taxpayer, as well as in the case of submitting consent of the taxpayer regarding the draft act, the audit technical support division, on the 5th and no later than on the 10th working day after the expiry of the term, shall:

a) prepare the draft order of the authorised official of the Audit Department on the renewal of the tax inspection;

b) immediately inform the mediation division and the auditor about issuing an order provided for by subparagraph (a) of this paragraph.

9. The auditor, no later than 3 working days after the introduction of the order on the renewal of the tax inspection shall sign an act, which shall be sent to the taxpayer and the mediation division (in the form of a certificate), and the relevant procedures established by the tax legislation shall be carried out thereafter.

Article 3 – Preparing the Consultative Council meetings

1. The written/electronic position of the taxpayer regarding the draft act (submitted through www.rs.ge (through the authorised page of the taxpayer at the official website of the Revenue Service)), as a rule, shall be submitted/sent to the Audit Department, including by parcel post.

2. The taxpayer position regarding the draft act or the application on the extension of the term in accordance with the record-keeping procedures (through the chancellery) shall be submitted to the mediation division, the auditor and the audit technical support division.

3. In the case of application on extension of the term of submitting the taxpayer position, the taxpayer shall be informed by the mediation division in writing or by any other means of communication (telephone, fax, electronic mail, etc.). This shall also be notified to the audit technical support division in electronic form (by the means of the document management software).

4. In accordance with paragraph 3 of this article, in the case of the extension of the term of submitting the taxpayer position, failure by the taxpayer to submit the position or consent of the taxpayer regarding the draft act, within 5 working days after expiry of the additional term, procedures established by paragraphs 8 and 9 of Article 2 of this procedure shall be carried out.

5. With the participation of the auditor and the taxpayer the mediation division shall, on the part of the submitted position, review in advance: the draft act, compliance of the imposing/reduction provided for by the draft act with the legislation, the taxpayer position, substantiated factual circumstances and additionally submitted evidence (if any). In addition, the review may be held at the meeting, as well as on telephone or through electronic communication means (by video call). Information about preliminary review (time, date, month and year of the meeting), along with the relevant materials, shall, through electronic communication means (electronic mail), be submitted to all members of the Consultative Council, who are authorised to participate in the preliminary review at their discretion.

6. (Deleted  –  15.11.2017, No 30473);

7. The mediation division shall prepare the issue for revision at the Consultative Council. For this purpose the mediation division shall forward/send the taxpayer position and the relevant materials (if any) to the members of the Consultative Council (including in the electronic form).

8. The chairperson of the Consultative Council shall define the date (hour, date, month and year) of the Consultative Council meeting, but no later than 15 working days after receiving the taxpayer position. The mediation division shall inform the taxpayer (in case provided for by paragraph 10 of Article 1 of this procedure), members of the Consultative Council, the auditor and other invited persons (if any) of the date of the meeting no later than at least one working day prior to the meeting, through any communication means (telephone, fax, electronic mail, etc.).

Prior to conducting the Consultative Council meeting or in the course of the Consultative Council meeting, on the basis of the application of the taxpayer or by the initiative of the Consultative Council, the review of the issue at the Consultative Council may be postponed, whereof the mediation division shall inform the taxpayer in writing or through any other means of communication (telephone, fax, electronic mail, etc.). This shall also be notified to the audit technical support division.

Order No 40531 of 22 September 2014 of the Head of Revenue Service  –  website, 10.11.2014

Order No 30473 of 15 November 2017 of the Head of Revenue Service  –  website, 21.11.2017

Order No 17923 of 12 July 2018 of the Head of Revenue Service  –  website, 23.10.2018

Article 4 – The review of an issue at the meeting of the Consultative Council

1. The chairperson of the Consultative Council shall head the Consultative Council meeting.

2. The Consultative Council shall be authorised if attended by the majority of its members.

3. When reviewing an issue the Consultative Council is obliged to rely on the norms established by the legislation of Georgia, as well as the principles of fairness, impartiality and objectivity.

4. Taking into account the complexity and special nature of the issue under review, by the decision of the chairperson of the Consultative Council, a specialist/expert may be invited to the Consultative Council, who must protect information privacy of the taxpayer, as well as principles provided for by paragraph 3 of this article.

5. The position of one taxpayer, as well as of several taxpayers regarding the draft acts drawn up against them may be reviewed at the Consultative Council.

6. The review of the issue at the Consultative Council starts without the taxpayer (in case if the taxpayer attends the meeting of the Consultative Council), with the participation of the inspecting auditor(s) and employees of the mediation division, who were assigned to study the issue. They shall submit information and evidence (if any) about the issue to be reviewed, as well as factual circumstances to the Consultative Council, whereafter the taxpayer joins the discussion.

7. The auditor must inform (submit to) the members of the Consultative Council the basis for imposing fees provided for by the draft act, in particular:

a) the situational guidelines approved by the order of the head of the Revenue Service;

b) the decision of the Consultative Council of the Revenue Service and an internal memorandum on the relevant factual circumstances;

c) a document proving the calculation mistake of the taxpayer;

d) materials reflecting factual circumstances established by a third party;

e) in the case of an independent interpretation of a legislative norm, detailed explanation of its application;

8. The employee of the mediation division who studies the issue shall inform the members of the Consultative Council of his/her position on the compliance of the imposing/reduction with the legislation, the correctness of the taxpayer position, as well as on the appropriateness of considering the substantiated factual circumstances and additionally submitted evidence (if any).

9. The Consultative Council shall review the submitted information and evidence (if any) at the meeting. Furthermore, if the taxpayer participates in/attends the meeting of the Consultative Council, he/she shall temporarily leave the meeting and each member of the Consultative Council and the auditor participating in the review of the issue shall state their position regarding each particular issue whereafter the Consultative Council shall be authorised:

a) to satisfy the taxpayer position;

b) to partly satisfy the taxpayer position;

c) not to satisfy the taxpayer position;

d) to leave the taxpayer position without consideration;

e) to make an interim decision and suspend the review of the taxpayer position;

f) to make a decision by combining the contents of subparagraphs (a)  –  (d) of this paragraph.

10. The Consultative Council shall make a decision on the issue to be reviewed by the majority of votes of the members of the Consultative Council.

11. In case if a member of the Consultative Council, a taxpayer, an employee of the mediation division, an auditor and/or an invited person (if any) cannot participate in the meeting of the Consultative Council (including, due to a technical problem in the case of participation in an electronic form), the review of the issue may be postponed if the absence of the relevant person might hinder the establishment of the substantiated factual circumstances and making an objective decision on the issue. In this case, an additional review of the issue shall be scheduled by the decision of the chairperson of the Consultative Council (minutes of the meeting shall be drawn up) within the defined term, whereof, in cases provided for by paragraph 10 of Article 1 of this procedure, the mediation centre shall inform the taxpayer in writing or by any other means of communication (telephone, fax, electronic mail, etc.). The audit technical support division shall receive information thereof in an electronic form (by the means of document management software).

12. The decision of the Consultative Council, in accordance with each episode of the reviewed issue, shall be stated at the meeting and explained to the auditor, the taxpayer (if the taxpayer attends the meeting of the Consultative Council) and employees of the mediation division. The mediation division shall draw up the draft of the decision, which shall be registered in the form of the minutes of the meeting of the Consultative Council in accordance with Article 5 of this procedure.

13. If the taxpayer is not invited to the meeting of the Consultative Council after preliminary review of the taxpayer claim, the meeting may also be held through electronic means of communication. For this purpose, the relevant employee of the mediation division shall send information about the issue to be reviewed, as well as about the inspection materials and draft of possible decision in an electronic form to the members of the Consultative Council. In this case, the provisions of paragraph 2 of Article 5 of this procedure shall apply accordingly.

14. (Deleted  –  22.9.2014; No 40531).

15. (Deleted  –  22.9.2014; No 40531).

16. (Deleted  –  22.9.2014; No 40531).

17. (Deleted  –  22.9.2014; No 40531).

Order No 40531 of 22 September 2014 of the Head of Revenue Service  –  website, 10.11.2014

Order No 50444 of 5 December 2014 of the Head of Revenue Service  –  website, 10.12.2014

Article 5 – Results of the review of the issue by the Consultative Council

1. On each issue reviewed at the meeting of the Consultative Council minutes of the meeting of the Consultative Council shall be drawn up which shall reflect the decision made at the Consultative Council.

2. The mediation division shall prepare the minutes of the meeting no later than within 7 working days after the meeting day. The chairperson of the Consultative Council, each member of the Consultative Council attending the meeting and the employee of the mediation centre who studied the issue and submitted it to the meeting of the Consultative Council for review shall sign the minutes of the meeting. The minutes of the meeting may be prepared in tangible (written), as well as in the electronic form in accordance with the order of the Minister of Finance of Georgia on Implementation of Electronic Document Management System in Various Bodies of the Central Office and System of the Ministry of Finance of Georgia. Signing the minutes of the meeting (including electronic visa) when the signatory has not registered a position opposing the decision on the issues under review in the minutes of the meeting in the form of a note shall mean a consent on the decision regarding the issues indicated in the minutes of the meeting.

3. The minutes of the meeting shall contain the following:

a) the title of the minutes of the meeting;

b) the sequential number and date of the minutes of the meeting (date, month, year);

c) the names, surnames and positions of the chairperson of the Consultative Council, members of the Consultative Council who participate in the review, the secretary of the Consultative Council meeting, the auditor and an employee of the mediation division;

d) the title/name and surname of the taxpayer, identification/personal number, the data of the representative and/or other invited persons (if any);

e) for each episode of the issue under review, a short summary of the taxpayer position and the decision;

f) other information, if required.

4. For the purpose of the topicality of the issue to be reviewed at the meeting of the Consultative Council and formation of the unified position of the Tax Authorities regarding the mentioned issue, the chairperson of the Consultative Council may issue a verbal instruction on preparing the relevant situational guideline draft.

5. The minutes of the meeting along with the relevant materials (if any), no later than within 3 working days after its drafting by the mediation division, shall be sent to the relevant division that carries out tax inspection (and is obliged to control the timely preparation of the tax inspection act on the basis of these minutes of the meeting and sending to the taxpayer) and the audit technical support division. The audit technical support division shall introduce/hand over the minutes of the meeting to the taxpayer.

6. On the basis of the minutes of the meeting of the Consultative Council, the auditor shall draw up an act of inspection, which after being agreed with the head of the relevant division, shall be handed over to the taxpayer:

a) by an auditor personally, and this shall be validated by the signature of the taxpayer and indication of the date on the second copy of the tax inspection act. b) in this case, the agreement with the head of the division shall be validated by signing the second copy of the tax inspection act;

b) by an auditor by e-mail, on the authorised address of the taxpayer;

c) on the basis of the memorandum of the head of the relevant division that carries out the tax inspection,

by the audit technical support division by post (including, electronic mail) or personally, and this shall be validated by the signature of the taxpayer and the date on the second copy of the tax inspection act.

7. In cases, provided for by subparagraphs (a) and (b) of paragraph 6 of this article, information on submitting tax inspection act to the taxpayer by the relevant auditor in the electronic form (including document management software) shall be notified to the audit technical support division.

7¹. The auditor must reflect information about the results of execution of the decision made by the Consultative Council in the memorandum and submit it to the management of the Audit Department. The auditor shall indicate in the memorandum the information on the status of complying with the decision made regarding each issue, with the relevant substantiation (including information reflected in the inspection act). The memorandum shall be signed by the employee of the mediation division, who studied the issue, and in the case of his/her absence  –  by the head/deputy head of the mediation division.

8. The tax inspection act shall reflect tax obligations (according to due interests) on the basis of the tax inspection results, the execution of the decision made at the meeting of the Consultative Council, as well as correcting mistakes/gaps independently identified by the inspector in the draft act (including with the consideration of notes/recommendations of the quality control division) and the relevant fine, after which procedures established by the tax legislation shall be carried out.

9. (Deleted  –  13.7.2015; No 25212).

10. (Deleted  –  13.7.2015; No 25212).

11. (Deleted  –  13.7.2015; No 25212).

Order No 40531 of 22 September 2014 of the Head of Revenue Service  –  website, 10.11.2014

Order No 25212 of 13 July 2015 of the Head of Revenue Service  –  website, 17.7.2015

Order No 38628 of 16 October 2015 of the Head of Revenue Service  –  website, 15.4.2016

Order No 22038 of 21August 2017 of the Head of Revenue Service  –  website, 24.8.2017

Article 6 – Final provisions

1. In certain cases, in accordance with the instruction of the head/deputy head of the Revenue Service and/or head/deputy head of the Audit Department (including verbal instruction), the review of the taxpayer position regarding the draft act may be carried out in a different manner other than defined in this procedure. In particular cases (for example, the expiry of the limitation period regarding to imposing tax obligations defined as a result of inspection, etc.), an inspection act may be drawn up without draft inspection act on the results of the tax inspection.

Order No 25212 of 13 July 2015 of the Head of Revenue Service  –  website, 17.7.2015

Annex No 4

Order No 56758 of 11 November 2013 of the Head of Revenue Service  –  website, 18.11.2013

Order No 25212 of 13 July 2015 of the Head of Revenue Service  –  website, 17.7.2015

Order No 17923 of 12 July 2018 of the Head of Revenue Service  –  website, 23.10.2018

––––––––––––––––––––––– –––––––––––––––

Name identification/ personal number of the taxpayer

Address: ––––––––––––––––––––––––––––

Notification

on the draft of the tax inspection act

For your information -----––––––––––– . 20–– . ––––– –––––––––––

    Name of the taxpayer  date month

Draft of the tax inspection act. You have the right to submit your substantiated position regarding any issue provided for by the draft tax inspection act within the term of 10 days after receiving the tax inspection act ( Tbilisi, 4 Gulua str.) to the Audit Department of the Revenue Service in writing or electronic form (through www.rs.ge (through the authorised page of the taxpayer on the official website of the Revenue Service)) which shall be reviewed in your attendance/attendance of your representative.

In addition, take a note that the results of the tax inspection carried out by the Revenue Service as a result of quality control procedures, may be amended.

In the case of failure to submit your position regarding the draft act to the Audit Department you remain authorised in accordance with the procedure established by Section XIV of the Tax Code to appeal the developed tax inspection act along with the decision made on its basis ( along with the order) and 'tax notice' issued on the basis of this document within 30 days after submitting the tax notice.

Annex: Draft tax inspection act in --- pages.

–––––––––––––––––––––––––––––

Audit Department/ signature of the authorised person

–––––––––––––––––––––––––––––

Signature of the taxpayer/authorised person

Notification

On the draft of the tax inspection act

For your information –––––––––– 20–– ––––– –––––––––––

The name of the taxpayer, date, month, draft tax inspection act. You have the right to submit your substantiated position regarding any issue provided for by the draft tax inspection act within the term of 10 days after receiving the tax inspection act ( Tbilisi, 4 Gulua str.) to the Audit Department of the Revenue Service in writing or electronic form which shall be reviewed in your attendance/attendance of your representative.

In addition, take a note that the results of the tax inspection carried out by the Revenue Service as a result of quality control procedures, may be amended.

In the case of failure to submit your position regarding the draft act to the Audit Department you remain authorised in accordance with the procedure established by Section XIV of the Tax Code to appeal the developed tax inspection act along with the decision made on its basis ( along with the order) and 'tax notice' issued on the basis of this document within 30 days after submitting the tax notice.

Annex: Draft tax inspection act in --- pages.

–––––––––––––––––––––––––––––

Audit Department/signature of the authorised person

–––––––––––––––––––––––––––––

signature of the taxpayer/authorised person

Annex No 5

Order No 50444 of 5 December 2014 of the Head of Revenue Service  –  website, 10.12.2014

Procedure for Mediation in the Customs Department

Article 1 – General Provisions

1. The procedure for mediation in the Customs Department ('the procedure') shall define procedures for the submission and review of the written/electronic (submitted through www.rs.ge (through the taxpayer authorised page of the official website of the Revenue Service)) position ('the taxpayer position') of the taxpayer and/or its representative ('the taxpayer') at the Consultative Council ('the Consultative Council') of the Customs Department regarding the draft post-clearance inspection act ('the draft act') drawn up by the Customs Department on imposing taxes, fees and/or sanctions.

2. The head of the Customs Department shall define the number and personal composition of the Consultative Council.

3. The Consultative Council shall be chaired by the head of the Customs Department. In his/her absence, one of the deputy heads of the Customs Department shall fulfil his/her duties.

4. The Legal Issues Division ('the Legal Issues Division') of the Customs Department shall ensure the organisation of the activities of the Consultative Council, the preparation of the issues to be discussed at the Consultative Council ('the agenda') and systematisation of the protocols of reviews ('the minutes of the meeting') in the written and/or electronic form.

Order No 10356 of 18 April 2016 of the Head of Revenue Service  –  website, 19.4.2016

Order No 10157 of 30 April 2018 of the Head of Revenue Service  –  website, 12.6.2018

Order No 17923 of 12 July 2018 of the Head of Revenue Service  –  website, 23.10.2018

Article 2 – Developing the draft act and introducing it known to the taxpayer

1. The draft act shall be drawn up by the auditor ('the auditor') who carries out post-clearance inspection.

2. The draft act shall be agreed (in the part of compliance with the law of imposing/non-imposing taxes and/or imposing sanctions) with the head/deputy head of the Post-Clearance Audit Division of the Customs Department ('the Post-Clearance Audit Division'). Furthermore, the inscription 'draft' will be indicated at each page of the draft act and it shall not be validated by the signature of the auditor.

3. The draft act shall be accompanied by evidence which is the basis for imposing taxes, fees and/or sanctions, unless the law restricts their introduction to the taxpayer.

4. The draft act with the accompanying materials shall be sent to the taxpayer in the form of a letter of the Customs Department by means of registered mail and/or placing in an electronic form on the page of the authorised user on the official website of the Revenue Service ('the authorised user page') and if impossible, shall be handed over personally.

5. The auditor shall ensure sending/handing over the draft act to the taxpayer. In addition, if the draft act shall be handed to the taxpayer directly, the handover shall be validated by the signature of the taxpayer and the indication of the date on the second copy of the letter.

6. Along with sending/handing over the draft act, the Post-Clearance Audit Division shall prepare the draft order of the authorised officer of the Customs Department on suspending the post-clearance inspection.

7. In the case of failure to submit the taxpayer position or an application on the extension of the term within the term defined by paragraph 1 of Article 3 of this procedure, as well as in the case of submitting the taxpayer consent regarding the draft act or on the basis of the decision of the Consultative Council, the Post-Clearance Audit Division shall draw up the draft order of the authorised officer of the Customs Department on the renewal of the suspended inspection.

8. The auditor shall, no later than within 3 working days after introducing the order on the renewal of post-clearance inspection, draw up an act whereafter the relevant procedures established by the tax legislation shall be carried out.

Order No 25212 of 13 July 2015 of the Head of Revenue Service  –  website, 17.7.2015

Order No 12188 of 28 April 2016 of the Head of Revenue Service  –  website, 6.5.2016

Order No 30473 of 15 November 2017 of the Head of Revenue Service  –  website, 21.11.2017

Article 3 – Submitting the taxpayer position

1. The taxpayer shall have the right within the term of 10 calendar days after receiving the draft act personally or through a representative, in a written or electronic form (through www.rs.ge (through the taxpayer authorised page of the official website of the Revenue Service)) to submit to the Customs Department the substantiated position regarding the draft act along with the relevant materials/evidence (if any) or apply to the Customs Department with the request of the extension of the term of submitting the taxpayer position with the indication of the particular term and particular grounds.

2. The taxpayer position may be submitted in the written or electronic form (through www.rs.ge (through the authorised page of the taxpayer on the official website of the Revenue Service)).

3. The taxpayer position or the application on the the extension of the term shall be deemed submitted within the time limit even in the case if it is delivered to the post-office or submitted to other structural unit of the Revenue Service within the term defined by paragraph 1 of this article. Furthermore, the relevant structural unit of the Revenue Service shall immediately send the taxpayer position or the application on the the extension of the term, along with the attached materials (if any), to the Customs Department.

4. The taxpayer position shall be transferred to the Legal Issues Division and the Post-Clearance Audit Division.

5. In the case of application on the extension of the term of submitting the taxpayer position, the Post-Clearance Audit Division shall inform the taxpayer in the written or electronic form on the extension of the term for submitting the position or the refusal.

6. In the case of failure to submit the taxpayer position within the term defined by paragraph 5 of this article or in the case of submitting the consent of the taxpayer regarding the draft act, the auditor shall draw up the draft order of the authorised official of the Customs Department on the renewal of the suspended inspection.

7. When preparing the taxpayer position, the taxpayer shall have the right to apply to the Customs Department within the term defined in paragraph 1 of this article and demand to get familiar with the documents (and/or receive their copies) withdrawn from the taxpayer during the post-clearance inspection. In such case, the term for submitting the taxpayer position shall be calculated from the date of introducing the requested documents and/or handing over their copies to the taxpayer.

8. The term for submitting the taxpayer position to the Customs Department shall be controlled by Post-Clearance Audit division.

Order No 10356 of 18 April 2016 of the Head of Revenue Service  –  website, 19.4.2016

Order No 10157 of 30 April 2018 of the Head of Revenue Service  –  website, 12.6.2018

Order No 17923 of 12 July 2018 of the Head of Revenue Service  –  website, 23.10.2018

Article 4 – Preparing an issue for the review at the Consultative Council meeting

1. The taxpayer position shall not be reviewed at the Consultative Council if:

a) the taxpayer position was submitted in violation of the term defined by paragraph 1 or 5 of Article 3 of this procedure;

b) the taxpayer position or a document attached to it is not drawn up in the official language of Georgia and a duly certified translation is not submitted either;

c) the taxpayer position is submitted by an unauthorised officer (in the case of submitting the taxpayer position in an electronic form through www.rs.ge (through the authorised page of the taxpayer on the official website of the Revenue Service) it is considered that the taxpayer position has been submitted by an authorised officer);

d) the taxpayer fully agrees with the draft act;

e) the taxpayer position has already been discussed at the Consultative Council meeting and/or the complaint regarding the same issue is being reviewed at the Council of Dispute Resolution of the Revenue Service or the Council of Dispute Resolution of the Revenue Service made a protocol resolution on this issue;

f) the written information of the taxpayer is provided, which contains information on the purpose of the position regarding the draft act or the extension of the term of submitting and the particular term for its submittal is not indicated. Furthermore, the taxpayer position is not submitted to the Customs Department within the term provided for in paragraph 1 of Article 3 of this procedure.

2. In the case of submitting various positions by the taxpayer regarding the draft act, the final position submitted prior to the expiry of the term provided for by paragraph 1 of Article 3 or paragraph 5 of the same Article shall be subject to the review at the Consultative Council meeting.

3. The Consultative Council may also review the issues related to the draft act, which will be expressed by the taxpayer during the preliminary review of the issue and/or in the course of the Consultative Council meeting and which are not submitted in the written position of the taxpayer.

4. The organisational issues related to the review of the taxpayer position at the Consultative Council shall be arranged by the Legal Issues Division, which shall, with the participation of the auditor and the taxpayer, review in advance in the part of the submitted position: the draft act, compliance of the imposing/non-imposing taxes and/or imposing sanctions provided for by the draft act with the legislation, the taxpayer position, the factual circumstances of substantial significance and additionally submitted evidence (if any). In addition, the preliminary review may be held at the meeting, as well as on telephone or through electronic communication means (by video call).

5. (Deleted  –  15.11.2017, No 30473);

6. The Legal Issues Division shall prepare the issue for revision at the Consultative Council. For this purpose the taxpayer position and the relevant materials (if any) shall be forwarded to the members of the Consultative Council (including in the electronic form) no later than within 5 days after the receipt.

7. The date of the Council meeting (no later than within 15 working days after the receipt of the taxpayer position) shall be defined by the chairperson of the Consultative Council.

8. The date of the meeting shall be informed to the members of the Consultative Council, the auditor and other invited persons (if any) by the Legal Issues Division no later than one day prior to the meeting by any means of communication (telephone, fax, e-mail, etc.).

9. Prior to conducting the Consultative Council meeting or in the course of the Consultative Council meeting, based on the application of the taxpayer or by the decision of the chairperson of the Consultative Council, the review of the issue at the Consultative Council meeting may be postponed, whereof the Legal Issues Division shall inform the taxpayer in writing or through any other means of communication (telephone, fax, electronic mail, etc.).

Order No 25212 of 13 July 2015 of the Head of Revenue Service  –  website, 17.7.2015

Order No 38628 of 16 October 2015 of the Head of Revenue Service  –  website, 15.4.2016

Order No 10356 of 18 April 2016 of the Head of Revenue Service  –  website, 19.4.2016

Order No 30473 of 15 November 2017 of the Head of Revenue Service  –  website, 21.11.2017

Order No 10157 of 30 April 2018 of the Head of Revenue Service  –  website, 12.6.2018

Article 5 – Review of an issue at the Consultative Council meeting

1. The chairperson of the Consultative Council shall head the Consultative Council meeting.

2. The Consultative Council shall be authorised if attended by the majority of its members.

3. The position of one taxpayer, as well as of several taxpayers regarding draft acts drawn up against them may be reviewed at the Consultative Council.

4. Taking into account the complexity and special nature of the issue under review, by the decision of the chairperson of the Consultative Council, a specialist/expert, who participates in the review of the issue may be invited to the Consultative Council. When making a decision, the invited guest does not have a right to vote and must keep information about the taxpayer confidential.

5. The taxpayer and/or its representative shall have the right to attend the Consultative Council meeting.

6. The member of the Consultative Council, the taxpayer/its representative and/or other invited person may participate in the Consultative Council meeting through electronic means of communication (by video call).

7. The taxpayer position shall be reviewed at the Consultative Council, notwithstanding whether he/she participates in the review of an issue at the Consultative Council or not. If the taxpayer and/or its representative does not participate in the review of the issue at the Consultative Council meeting, the taxpayer position shall be submitted to the Consultative Council meeting by the representative of the Legal Issues Division.

8. Attending the Consultative Council meeting by the auditor and his/her participation in the review of the issue is mandatory and may be carried out through electronic means of communication (by video call). In the case of the absence of the auditor, the head/deputy head of the Post-Clearance Audit Division shall participate in the meeting of the Consultative Council.

9. In case if the member of the Consultative Council, the taxpayer, the auditor, an employee of the Legal Issues Division and/or other invited person cannot participate in the Consultative Council meeting (including, due to a technical problem in the case of participation in electronic form), if a non-attendance of the relevant person might hinder establishment of the factual circumstances of substantial significance and making a fair decision on the issue, the review of the issue may be postponed by the decision of the chairperson of the Consultative Council (minutes of the meeting shall be drawn up), whereof the Legal Issues Division shall inform the taxpayer in writing or by any other means of communication (telephone, fax, e-mail, etc.).

10. The inspecting auditor(s) and an employee of the Legal Issues Division shall submit to the Consultative Council information on the issues to be reviewed and evidence, whereafter the taxpayer or its representative gets involved in the review of the issue (if he/she attends the Consultative Council meeting).

11. The auditor shall be obliged to inform the meeting on the factual circumstances, as well as the basis for imposing fees provided for by the draft act.

12. The employee of the Legal Issues Division shall be obliged to inform in the meeting the position of the Division on compliance with the legislation of imposing/non-imposing taxes and/or imposing sanctions, the correctness of the taxpayer position, as well as on the appropriateness of considering factual circumstances of substantial significance and additionally submitted evidence.

13. The Consultative Council shall review the submitted information and evidence at the meeting. Each member of the Consultative Council and the auditor who participates in the review of the issue, shall be obliged to express their position; during this time the taxpayer/representative of the taxpayer shall temporarily leave the meeting.

14. The Consultative Council shall be authorised:

a) to satisfy the taxpayer position;

b) to partly satisfy the taxpayer position;

c) not to satisfy the taxpayer position;

d) to leave the taxpayer position without consideration;

e) to make an interim decision and suspend the review of the taxpayer position;

f) to make a decision by combining contents indicated in subparagraphs (a)  –  (d) of this paragraph.

15. The decision at the meeting of the Consultative Council shall be made by the majority of the votes of the members of the Consultative Council who participate in the meeting.

16. The decision of the Consultative Council shall be declared at the meeting and explained to the auditor, the taxpayer (in case, if the taxpayer attends the meeting of the Consultative Council) and the representative of the Legal Issues Division. The Legal Issues Division shall draw up the draft of the decision, which, according to Article 6 of this procedure, is registered in the form of the minutes of the meeting of the Consultative Council.

Order No 10356 of 18 April 2016 of the Head of Revenue Service  –  website, 19.4.2016

Order No 10157 of 30 April 2018 of the Head of Revenue Service  –  website, 12.6.2018

Article 6 – Registration of the results of the review of an issue by the Consultative Council

1. On each issue reviewed at the meeting of the Consultative Council, minutes of the meeting of the Consultative Council shall be drawn up ('the minutes of the meeting'), which shall reflect the decision made at the Consultative Council.

2. The Legal Issues Division shall draw up the minutes of the meeting, no later than within 7 working days after the day of the meeting. The minutes of the meeting may be drawn up in paper (in writing), as well as in an electronic form.

3. The minutes of the meeting shall contain the following:

a) the title of the minutes of the meeting;

b) the place where the minutes of the meeting was drawn up, the sequential number of the minutes of the meeting (date, month, year);

c) the names, surnames and positions of the chairperson of the Consultative Council, members of the Consultative Council who participate in the review, the secretary of the meeting of the Consultative Council, the auditor and an employee of the Legal Issues Division;

d) the title/name and surname of the taxpayer, identification/personal number, the data of the representative and/or other invited persons;

e) in accordance with the issue under review, the short summary of the taxpayer position and the decision made;

f) other information, if required.

4. The minutes of the meeting shall be signed by: The chairperson of the Consultative Council, members of the Consultative Council, who attended the review of the issue and those employees of the Legal Issues Division, who studied the issue and submitted it for the review at the Consultative Council meeting. Signing the minutes of the meeting (including electronic visa), unless a position opposing the decision made at the meeting is registered in the minutes of the meeting in the form of a note, shall mean consent on the decision made regarding the issues reflected in the minutes of the meeting.

5. For the purpose of the topicality of the issue to be reviewed at the meeting of the Consultative Council and formation of the unified position of the Tax Authorities regarding the mentioned issue, the chairperson of the Consultative Council may issue a verbal instruction on preparing the relevant situational guideline draft.

6. A copy of the minutes of the meeting, along with the copies of the relevant materials shall be sent to the Post-Clearance Audit Division by the Legal Issues Division no later than within 3 working days; in addition, the Legal Issues Division shall introduce/submit the minutes of the meeting to the taxpayer.

7. On the basis of the minutes of the meeting, taking into account the decision of the Consultative Council:

a) the Post-Clearance Audit Division shall carry out procedures provided for by paragraphs 7 and 8 of Article 2 of this procedure;

b) The post-clearance act shall, on the basis of the results of the post-clearance inspection, the results of the enforcement of the decision made at the Advisory Council, as well as on the basis of the results of correcting mistakes/gaps identified independently in the draft act by the inspector, reflect the tax liabilities and/or the relevant fine, as a result of which the relevant procedures established by the tax legislation shall be carried out.

8. (Deleted  –  13.7.2015; No 25212).

9. (Deleted  –  13.7.2015; No 25212).

10. (Deleted  –  13.7.2015; No 25212).

11. (Deleted  –  13.7.2015; No 25212).

12. (Deleted  –  13.7.2015; No 25212).

13. (Deleted  –  13.7.2015; No 25212).

14. (Deleted  –  13.7.2015; No 25212).

Order No 25212 of 13 July 2015 of the Head of Revenue Service  –  website, 17.7.2015

Order No 38628 of 16 October 2015 of the Head of Revenue Service  –  website, 15.4.2016

Order No 10356 of 18 April 2016 of the Head of Revenue Service  –  website, 19.4.2016

Order No 10157 of 30 April 2018 of the Head of Revenue Service  –  website, 12.6.2018

Article 7 – Final provisions

In certain cases, in accordance with the instruction of the head/deputy head and/or head/deputy head of the Customs Department of the Revenue Service (including verbal instruction), the taxpayer position regarding the draft act may be reviewed in a different manner other than defined in this procedure. In particular cases (e.g. the expiry of the term of the statute of limitation regarding the accrual of tax liability imposed as a result of the inspection, defining particular term for post-clearance inspection by the decision of the court, the decision of the legal authority or information, satisfying the written application of the taxpayer about making changes to the customs declaration, etc.) the inspection act may be drawn up without the draft act for post-clearance inspection.

Order No 25212 of 13 July 2015 of the Head of Revenue Service  –  website, 17.7.2015

Annex No 6

Order No 25212 of 13 July 2015 of the Head of Revenue Service  –  website, 17.7.2015

Addresses, from which it is possible to participate in the meeting of the Council through the means of electronic communication

Service Centres:

Tbilisi Service Centres

Tbilisi Isani-Samgori, Old Tbilisi and Didgori service centres

4 Gulua Street, Tbilisi

2 26 22 21

E-mail: info@rs.ge

Tbilisi Vake-Saburtalo service centre

68a Kostava Avenue

2 26 18 44

2 26 18 43

E-mail: info@rs.ge

Tbilisi Didube-Chughureti service centre

140a, Aghmashenebeli Avenue

2 26 18 00

E-mail: info@rs.ge

Tbilisi Gldani-Nadzaladevi service centre

1 Sarajishvili str.

2 26 18 35

E-mail: info@rs.ge

________________________________________________________

Rustavi Service Centres

36 Kostava ave., Rustavi

2 26 21 17

22 Aristotele str., Tsalka

E-mail: info@rs.ge

________________________________________________________________

Marneuli Service Centre

73 Rustaveli str., Marneuli

106 Sulkhan Saba str., Bolnisi

E-mail: info@rs.ge

________________________________________________________________

Telavi Service Centres

41 Aghmashenebeli str., Telavi

2 26 22 63

2 26 22 64

2 26 22 65

19a Aghmashenebeli str., Tsnori

2 26 18 94

2 26 18 95

25 Kiziki str., Lagodekhi

2 26 24 25

2 26 24 26

2a Japaridze str., Sagarejo

2 26 18 90

2 26 18 91

82 Hereti str., Dedoplistskaro

E-mail: info@rs.ge

________________________________________________________________

Akhaltsikhe Service Centres

54 P.Natenadze str., Akhaltsikhe

2 26 21 27

5 Meskheti str., Borjomi

2 26 21 72

93 Tavisupleba str., Akhalkalaki

E-mail: info@rs.ge

_________________________________________________________________

Gori Service Centres

50 Samepo str., Gori

2 26 17 68

2 26 18 60

7 Kostava str., Khashuri

2 26 22 40

E-mail: info@rs.ge

_________________________________________________________________

Mtskheta Service Centres

17a Mukhrani str., Mtskheta

2 26 18 51; 2 26 18 52

67 Rustaveli str., Tianeti

9 Aghmashenebeli str., 2nd floor, Kazbegi

E-mail: info@rs.ge

___________________________________________________________________

Batumi Service Centres

5a Pirosmani str., Batumi

2 26 17 20

2 26 17 25

136 Rustaveli str., Kobuleti

E-mail: info@rs.ge

___________________________________________________________________

Kutaisi Service Centres

5 Javakhishvili str., Kutaisi

2 26 22 63; 2 26 26 51

20 Kostava str., Ambrolauri

2 26 23 266 26 52

28 Rustaveli str., Samtredia

E-mail: info@rs.ge

_________________________________________________________________

Zestaponi Service Centres

5 Tsereteli str., Zestaponi

2 26 23 52

2 26 23 53

5 Ninoshvili str., Chiatura

E-mail: info@rs.ge

____________________________________________________________

Poti Service Centres

4 D. Tavdadebuli str., Poti

2 26 18 20

235 Rustaveli str., Senaki

E-mail: info@rs.ge

____________________________________________________________

Ozurgeti Service Centre

3 I.Shemokmedeli str., Ozurgeti

2 26 23 41

E-mail: info@rs.ge

_______________________________________________________________

Zugdidi Service Centres

1 Gamarjveba str., Zugdidi

2 26 23 39 ; 2 26 23 38

1 Iliko Gabliani str., Mestia

E-mail: info@rs.ge

Annex No 7

Order No 22758 of 30 August 2017 of the Head of Revenue Service  –  website, 19.9.2017

Application on

the Refusal to Appeal the Decision and the Recognition of the Amount Deposited in the Temporary Registration Card of the Taxpayer

1.1. List of documents attached to the application (indicate the name of the document(s) attached to the application)

1.2. Confirmation I confirm that all statements submitted in the present application form are valid.

Signature of the taxpayer/authorised representative: ___________________________________

Annex No 8

Order No 16415 of 23 May 2019 of the Head of Revenue Service  –  website, 24.5.2019

Procedure for Mediation in the Tax Monitoring Department

Article 1 – General provisions

1. The mediation procedure ('the procedure') in the Tax Monitoring Department shall define procedures for the review of the written/electronic position ('the taxpayer position') of the taxpayer and/or their representative at the Consultative Council ('the Consultative Council') of the Tax Monitoring Department regarding the draft protocol on the results of the current control (inventory taking) carried out by the Tax Monitoring Department.

2. The head of the Tax Monitoring Department shall define the number and personal composition of the Consultative Council by an order.

3. The Consultative Council shall be chaired by the head of the Tax Monitoring Department, in the case of its absence, one of the deputy heads of the Department shall act as a chairperson of the Consultative Council.

4. The Legal Issues Division ('the Legal Issues Division') of the Tax Monitoring Department shall ensure the organisation of the activities of the Consultative Council, the preparation of the taxpayer positions ('the agenda') to be reviewed at the Consultative Council and systematization of the protocols of review ('the minutes of meetings') in the written and/or electronic form.

5. The Consultative Council shall review the substantiated taxpayer position submitted on the issues falling within the competence of the Department regarding the draft protocol in a collegial manner at the closed meeting, by which it fully or partly does not agree (according to separate episodes) with the draft protocol (results identified during the current control) with the indication of the relevant grounds.

Article 2 – The work procedure of the Consultative Council

1. The Tax Monitoring Department shall send the draft protocol to the taxpayer for the review and shall notify (in accordance with Annex No 9) that the latter shall be authorised, in case of an opposite position, within 5 working days after the receipt of the draft protocol, to submit to the Tax Monitoring Department a written/electronic position regarding the disputable issue along with available evidence.

2. The taxpayer shall have the right to submit to the Tax Monitoring Department the taxpayer position regarding the draft protocol along with the relevant materials/evidence (if any) within 5 working days after the receipt of the draft protocol personally or through the representative or by e-mail or apply to the Tax Monitoring Department to extend the term for the submission of the taxpayer position, with the indication of the particular term and the particular basis.

3. The taxpayer position or the application on the the extension of the term shall be deemed submitted within the time limit even if it is delivered to the post-office or to other structural unit of the Revenue Service within the term provided for by paragraph 1 of this article. Furthermore, the relevant structural unit of the Revenue Service shall immediately forward the taxpayer position or the application on the the extension of the term, along with the attached materials (if any), to the Tax Monitoring Department.

4. In the case of application to extend the term of submitting the taxpayer position, the taxpayer shall be informed of the decision made by the head of the Tax Monitoring Department on the the extension of the term by the Legal Issues Division in the written form or through any other means of communication (telephone, fax, e-mail, etc.).

5. On the basis of the decision of the management of the Tax Monitoring Department, the taxpayer shall have the right to attend the meeting of the Consultative Council personally and/or through a representative. Furthermore, if requested, the authorised representative shall, along with the position, submit a document proving the relevant powers to the Consultative Council.

6. In the case indicated in paragraph 1 of this article, the manager of the structural unit who carries out the current control, if required, shall ensure the issuance of the individual administrative and legal act regarding the extension of the term of conducting the relevant current control procedure.

7. The Legal Issues Division shall ensure the submittal of the taxpayer position and the accompanying materials to the Consultative Council.

8. The chairperson of the Consultative Council shall define the date of the Consultative Council meeting, but no later than within 15 working days after receiving the taxpayer position. The Legal Issues Department shall through any means of communication (telephone, fax, e-mail, etc.) inform the date of the meeting to the taxpayer (in cases provided for by paragraph 5 of this article), to the members of the Consultative Council, the person who carries out current control procedures and other persons (if any) at least one day prior to the meeting.

9. A member of the Consultative Council, a taxpayer/representative and/or other invited person (if any) may participate in the Consultative Council meeting through electronic communication means (by video call).

10. At the Consultative Council meeting, an authorised officer ('the officer') of the tax authority carrying out the current control procedure and/or the head of the relevant structural unit of the Tax Monitoring Department, private tax inspector directly and/or through electronic means of communication (by video call) may participate in the review of the issue.

11. The position of the taxpayer shall not be reviewed at the Consultative Council meeting (except for cases provided for by Article 4), provided that one of the below given conditions is met:

a) the taxpayer position is submitted to the Tax Monitoring Department in violation of the term defined by paragraph one of this article;

b) the written information of the taxpayer is provided, which contains information on the purpose of the position regarding the draft act or the extension of the term of submittal, and the particular term for its submittal is not indicated. Furthermore, the taxpayer position is not submitted to the Tax Monitoring Department within the term provided for in paragraph 1of this article;

c) the taxpayer position or a document attached to it is not drawn up in the official language of Georgia and a duly certified translation is not submitted either;

d) the taxpayer fully agrees with the draft minutes of the meeting;

e) a non-authorised person submitted the taxpayer position.

Article 3 – Consultative Council meeting

1. The chairperson of the Consultative Council shall hold and head the Consultative Council meeting.

2. The Consultative Council shall be authorised if attended by the majority of its members.

3. When reviewing an issue the Consultative Council is obliged to rely on the norms established by the legislation of Georgia, as well as the principles of fairness, impartiality and objectivity.

4. The position of one taxpayer, as well as of several taxpayers regarding the draft minutes of meetings drawn up against them may be reviewed at the Consultative Council.

5. If the taxpayer (on the basis of the decision of the management of the Tax Monitoring Department, the taxpayer has the right to attend the Consultative Council meeting), an employee, an officer and/or other invited person (if any) of the Legal Issues Department fails to participate in the Consultative Council (including, due to a technical problem in the case of participation in an electronic form), the review of the issue may be postponed, if the absence of the relevant person hinders the establishment of the substantiated factual circumstances and making an objective decision on the issue. In this case, additional review of the issue shall be scheduled within the term defined by the decision of the chairperson of the Consultative Council, whereof the minutes of the meeting shall be drawn up. The Legal Issues Division shall inform the taxpayer thereof in writing or through any other means of communication (telephone, fax, e-mail, etc.).

6. By the initiative of the chairperson/deputy chairperson of the Consultative Council or by the request of the taxpayer (if, based on the decision of the manager of the Tax Monitoring Department, the taxpayer has the right to attend the Consultative Council meeting) the review of the issue may be put on a back burner.

7. Taking into account the complexity and specific nature of the issue under review, by the decision of the chairperson of the Consultative Council, an expert/specialist or other relevant persons may be invited to the meeting of the Consultative Council, who shall be obliged to keep the information received about the taxpayer confidential.

8. The relevant employee of the Legal Issues Department shall submit the information on the issue to be reviewed at the meeting of the Consultative Council.

9. The review of the issue at the meeting of the Consultative Council shall start without the taxpayer, with the participation of the authorised person (officer, private tax inspector) who carries out the current control procedure and the employee of the Legal Issues Division, who was assigned to study the issue. They will submit to the members of the Consultative Council information about the issue to be reviewed and the evidence (if any), as well as factual circumstances related to the issue to be reviewed, whereafter the taxpayer joins the discussion (if, based on the decision of the management of the Tax Monitoring Department, the taxpayer attends the Consultative Council meeting).

10. The Consultative Council shall hear the verbal explanation of the taxpayer regarding the disputable issue according to each episode (if, based on the decision of the management of the Tax Monitoring Department, the taxpayer attends the Consultative Council meeting), whereafter the taxpayer temporarily leaves the Consultative Council meeting.

11. The decision on the issue to be reviewed shall be taken by the majority of the votes of members of the Consultative Council attending the meeting of the Consultative Council. In addition, it is prohibited to refrain from voting.

12. The Consultative Council shall review the submitted information and evidence (if any) regarding the position of the taxpayer and after the reconciliation of the positions expressed regarding the disputable issues by each member of the Consultative Council, and after the collegial meeting, the Council shall develop recommendations and therefore, it is authorised:

a) to satisfy the taxpayer position;

b) to partly satisfy the taxpayer position;

c) not to satisfy the taxpayer position;

d) to leave the taxpayer position without consideration;

e) to make an interim decision and suspend the review of the taxpayer position;

f) to make a decision by combining contents indicated in subparagraphs (a)  –  (d) of this paragraph.

13. The decision of the Consultative Council shall be declared at the meeting. The decision of the Consultative Council on the results of the review of the taxpayer position, shall be registered in the form of the minutes of the meeting of the Consultative Council, which shall be drawn up by the Legal Issues Division within the term of 5 working days after making a decision.

14. The minutes of the meeting shall be signed by the chairperson of the meeting and each member of the Consultative Council attending the meeting.

15. The minutes of the meeting may be prepared in tangible (written), as well as in the electronic form in accordance with the order of the Minister of Finance of Georgia on Implementation of Electronic Document Management System in Various Bodies of the Central Office and System of the Ministry of Finance of Georgia. Signing the minutes of the meeting (including electronic visa), unless a position opposing the decision made at the meeting is registered in the minutes of the meeting in the form of a note, shall mean consent on the decision made regarding the issues reflected in the minutes of the meeting.

16. The minutes of the meeting shall contain the following:

a) the title of the minutes of the meeting;

b) the sequential number of the minutes of the meeting and date (date, month, year);

c) the names, surnames and positions of the chairperson of the Consultative Council, members of the Consultative Council who participate in the review, the authorised official of the tax authority that carries out current control and an employee of the Legal Issues Division;

d) the title/name and surname of the taxpayer, identification/personal number, data of the representative and/or other invited persons (if any);

e) for each episode of the issue under review, a short summary of the taxpayer position and the decision made;

f) other information, if required.

17. The copy of the Consultative Council meeting shall be sent to the taxpayer if requested by the latter.

18. For the purpose of the topicality of the issue to be reviewed at the meeting of the Consultative Council and formation of the unified position of the Tax Authorities regarding the mentioned issue, the chairperson of the Consultative Council may issue a verbal instruction on preparing the relevant situational guideline draft.

Article 4 – Final provisions

1. In certain cases, in accordance with the instruction of the head/deputy head and/or head/deputy head of the Tax Monitoring Department of the Revenue Service the review of the taxpayer position regarding the draft protocol may be carried out in a different manner other than defined in this procedure.

2. In particular cases (based on the complexity of the issue) by the decision of the head of the Tax Monitoring Department, the Consultative Council shall review:

a) problematic issues that arouse regarding the issues to be taken/taken in the Revenue Service, in the Council of Dispute Resolution under the Ministry of Finance of Georgia or in the court;

b) certain issues received at the Department with the objective of developing a unified methodological approach and relevant recommendations.

Annex No 9

Order No 16415 of 23 May 2019 of the Head of Revenue Service – website, 24.5.2019

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Name, identification/personal number of the taxpayer

Address: ––––––––––––––––––––––––––––

Notification

Regarding the draft protocol drawn up

on the results of current control (inventory taking)

For your information –––––––––– 20–– ––––– –––––––––––

Name of the taxpayer, date, month

The draft protocol drawn up on the results of the current control (inventory taking).

You shall have the right to submit the draft protocol on the results of the current control (inventory taking) to the Tax Monitoring Department of the LEPL called Revenue Service within 5 working days after its receipt (68a Merab Kostava str./2 Simon Chikovani str., Tbilisi) in written or electronic form, your substantiated position on the result of the current control (inventory taking) regarding any issue provided for by the draft protocol, which shall be reviewed with your participation/participation of your representative. You will additionally be informed on the date and time of the Consultative Council meeting.

In the case of failure to submit the position within the indicated time limit, the draft protocol drawn up on the results of the current control (inventory taking) shall be registered in the form of an individual administrative and legal act and you shall be given an opportunity to exercise the right granted by the procedure defined by chapter XIV of the Tax Code to appeal the decision of the tax authority.

Annex: The draft protocol drawn up on the results of the current control (inventory taking) in ---pages.

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Tax Monitoring Department/signature of the authorised person

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Taxpayer/signature of the authorised person/