Horeca sector owes GEL 25 million to the distribution companies

Horeca sector owes GEL 25 million to the distribution companies

access_time2020-10-28 16:55:22


During the pandemic from March 21 to date, the Horeca sector in Georgia have  GEL 25 million of debt to the distribution companies, and so far there are no preconditions that this debt will be paid in the near future.


According to President of Georgian Hotel and Restaurant Federation Shalva Alaverdashvili, the sector does not deny the existence of this debt, but will not be able to start paying it until  the tourism industry recovers and the borders are opened.


“How to repay debts if there is no job? Hotels are closed all over the country, and will not open  soon due to the lack of  tourists. We do not deny that we can’t pay for the products but we will certainly cover the debt as soon as  the tourism sector is restored and the hotels are opened, ”he explains.


The head of the Association of Distributors Iva Chkonia,  doesn’t  specify the  affected companies that provided hotels and restaurants with their products, but have not  received payment which are  very often quite substantial amounts - for example, GEL 500,000.


 “The extension of the 6-month preferential regime for VAT payments can somehow mitigate the situation, otherwise many of the companies will be left without working capital and will be forced to close ” Iva Chkonia says.


Chkonia stresses that the distribution sector does not ask the government for financial assistance from such as tax incentives and a bank loan in order to be able to work.


“The forecasts are not encouraging as the government officials  clearly told us that they are not going to extend preferential tax regime,” the head of the Association Iva Chkonia notes.


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