Customs evasion involves the deliberate avoidance of paying taxes and duties owed to the state budget by importers or exporters, constituting a serious economic crime in Georgia. This act harms the country's economic interests and creates an unfair competitive environment. Customs evasion can take various forms, such as artificially undervaluing goods, incorrectly specifying the Commodity Code (HS code), or concealing the actual quantity of goods. Georgian legislation takes a strict stance on such violations, imposing substantial financial sanctions and criminal liability, especially when large amounts of tax evasion are involved.
What Does Customs Evasion Defense Service Cover?
Lawyers registered on Legal.ge offer comprehensive services for companies and individuals accused of violating customs rules. The services include:
- Tax and Customs Audit: Detailed examination of import/export documentation and identification of potential risks before a dispute arises.
- Defense in Customs Disputes: Appealing decisions of the Revenue Service through administrative channels (Customs Department and the Dispute Resolution Council of the Ministry of Finance).
- Criminal Defense: If a case is initiated under Articles 214 or 218 of the Criminal Code (Tax Evasion), the lawyer ensures the client's defense during investigation and court stages.
- HS Code Classification Defense: Handling disputes regarding the reclassification of goods by customs, which often leads to increased taxes and penalties.
- Alternative Tax Audit: Preparing independent audit reports to refute the position of the customs authority.
Common Situations and Scenarios
Customs disputes often arise from differences in interpretation or documentation errors. Typical scenarios include:
- Valuation Disputes: The customs authority disagrees with the price stated in the invoice (Method 1) and uses backup methods to increase the customs value of the goods, automatically raising VAT and import duties.
- Incorrect HS Code Classification: An importer brings in technical equipment at a 0% rate, but customs changes the code to a 12% category and imposes a fine for the unpaid difference.
- Documentary Discrepancies: The invoice sent by the supplier and the transport waybill do not match in weight or quantity, which is perceived as an attempt at smuggling or tax evasion.
- Rejection of Certificate of Origin: When using a preferential tax regime (e.g., with the EU or Turkey), customs rejects the Certificate of Origin (EUR.1) and demands full tax payment.