How is the Georgian gov't supporting the tourism industry hit by the coronavirus outbreak?

Georgian Economy Minister Natia Turnava held a presentation today on how the government is planning to help the tourism industry reopen and overcome challenges caused by the coronavirus pandemic. 

We have been helping the tourism industry with various benefits and programmes since the first day of the crisis, but this is no longer enough", said Turnava.

The government provided "emergency support" that included deferring property and personal income taxes for four months for businesses operating in the travel and tourism sector until November 1, 2020.

In total taxes were deferred for 6,118 businesses. The budget for this support totalled 113 million GEL. Furthermore, small hotels get subsidies from the state for 80 per cent of bank interest payments throughout six months. A total of 2,200 hotels applied for the subsidy. About 10 million GEL will be spent on this programme. The government also created the opportunity for the hotels to seek bank loan restructuring", said Turnava.

Turnava added that the state helps employees, who lost jobs or were sent home for unpaid leave and also employers for maintaining jobs.

Employees will get 1,200 GEL for six months, which is 200 GEL monthly. And the self-employed who lost their jobs will receive 300 GEL as a one-off payment", said Turnava.

Last year Georgia hosted almost 9.4 million visitors which generated billion in revenue. Photo: Nino Alavidze/Agenda.ge.

Meanwhile, employers will receive a state subsidy for every maintained job:

• Monthly salaries of 750 GEL will be fully exempt from personal income tax for six months
• Monthly salaries of 1,500 GEL will be exempt from personal income tax for the portion of 750 GEL

Turnava said that now the new, third phase of support is launching for the tourism sector of Georgia. 

The guest accommodation segment of Georgian tourism sector will be exempted from property tax in 2020, while the personal income tax will be deferred until the end of 2020.

We are launching an unprecedented program of subsidising 80 per cent of interest rates on hotel business loans, in amounts up to 5 million GEL, for all the hotels, with an annual turnover of no more that 20 million GEL", Turnava said.

Turnava added that the programme will last for six months and will apply to more than 95 per cent of the hotel industry. 

We will also help and subsidise participation in tourism exhibitions, which will soon become actual and will help our tourist facilities to bring a new tourist image of Georgia to the world market. We will also work with the Ministry of Health to assist the World Tourism Organization to establish safety standards", Turnava said.

Economy Minister said that the state helps employees, who lost jobs or were sent home for unpaid leave and also employers for maintaining jobs. Photo: Nino Alavidze/Agenda.ge.

Support for food and beverage segment includes:

• Exempt from Property Tax in 2020
• Eligibility for Credit Guarantee Schemes
• Support in the introduction and implementation of UNWTO recommendations

Support for travel agencies and guides includes:

• Exempt from property tax in 2020
• Bank guarantee interest subsidised for six months 
• Subsidies on co-participation fees for international travel and tourism fairs
• Support in the introduction and implementation of UNWTO recommendations
• Re-training program for guides
• Support to guides in terms of free visits to museums, protected areas, etc.

How much will it cost to support the tourism industry?

• 45 million GEL will be spent on property tax exemption of tourism industry in 2020
• 90 million GEL - personal income tax exemption and deferral for travel industry 
• 60 million GEL - bank loan subsidies for about 3,000 hotels 
• 5 million GEL - support to travel agencies and guides 

In total 200 million GEL will be spent from the state budget for tourism sector recovery plan.