A legislative package has been reintroduced in Parliament that предусматривает (provides for) increasing the excise tax rate on passenger cars older than six years.

The draft has again been submitted under an accelerated review procedure - it will be considered in the first reading on March 31, and adopted in the second and third readings on April 1.

The bill had previously been submitted to Parliament for expedited adoption during the March 17-20 plenary week. It was passed in the first reading on March 17, but due to the absence of parliamentary sessions in the following days, it could not be adopted in all three readings. Accordingly, the initiators resubmitted the draft.

The amendments, which increase the excise rate on passenger cars older than six years, are being introduced to the Tax Code.

The main change in tax legislation is that the excise rate for vehicles aged 0 to 6 years will be set at 1.5 GEL per 1 cm³ of engine capacity, while for vehicles older than six years, the excise rate will be set at 4.5 GEL per 1 cm³.

At the same time, the existing table in the Tax Code defining current excise rates for vehicles will be abolished. New provisions will be added, establishing special rates that differ from the base rate.

Specifically, hybrid vehicles will retain a preferential rate - reduced by 60% from the base rate - while right-hand drive vehicles will be subject to a rate tripled relative to the base rate.

The transitional provisions of the bill stipulate that vehicles imported into Georgia before April 1, 2026, or those already in transit for import before that date, will be subject to the current excise rates. Additionally, if transportation is carried out by land or the vehicle is driven into the country, the current rates will apply provided the vehicle enters Georgia by July 1, 2026.

The initiators of the bill are MPs from Georgian Dream, who state that tax policy should be used as an effective tool to gradually renew the vehicle fleet, achieve environmental and road safety goals, and support sustainable development.

“A significant portion of passenger cars imported into Georgia are older than six years, which results in an aging vehicle fleet. This trend negatively affects the environment, road safety, and energy efficiency. Older vehicles typically have higher emissions, less efficient fuel consumption, and a greater risk of technical failure, contributing to increased air pollution and more frequent road accidents.

The current excise taxation system, despite age differentiation, does not effectively encourage the import of newer or relatively new vehicles. Under existing rates - especially the relatively low excise on 6-8-year-old cars - it remains economically advantageous to import vehicles of this age category and does not create an effective financial barrier to limit the import of older cars.

The adoption of this law is necessary to create a stable and predictable tax environment by introducing a moderate and unified excise rate for cars aged 0 to 6 years, and significantly increasing excise for vehicles older than six years,” the initiators of the bill stated.