Abkhazia to introduce unified social tax, but veterans push back

Unified social tax in Abkhazia

Abkhazia is set to implement a unified social tax, replacing five separate mandatory payments into off-budget funds with a single contribution.

The overall tax rate will also be reduced – from 20% to 18% – while the rate for individual entrepreneurs will drop from 9.5% to 5%.

The changes were announced by Minister of Taxes and Duties Edgar Benia, who said the reform would reduce the burden on taxpayers, simplify administration, cut down on informal employment, and ensure stable funding for social programs.

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The draft law on the unified social tax has already passed its first reading in Abkhazia’s parliament. However, one significant obstacle to its full adoption in the current form proposed by the executive branch is opposition from veterans’ organizations.

They fear that the shift to a unified tax could reduce the quality of services for those injured in the 1992–93 Georgian-Abkhaz war.

The government has tried to reassure veterans, stating that the reform does not involve eliminating or merging existing off-budget funds, including the Disabled Veterans Fund. Officials stress that the initiative aims to improve collection, transparency, and efficiency and will establish a targeted social budget fund.

Prime Minister Vladimir Delba explained that the essence of the law is consolidation and centralization:

“In practice, we see that many business payments are not properly administered, especially insurance contributions. Currently, only the Pension Fund has the authority to enforce debt collection. Other funds lack this power, which is unfair to other taxpayers.”

Delba believes the new system will consolidate scattered contributions into a single, streamlined payment – simplifying the process and creating a more transparent structure.

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First Deputy Head of the Presidential Administration Dmitry Shamba also confirmed that the reform does not include eliminating the Disabled Veterans Fund.

“On the contrary, the bill is designed to ensure that funds reach veterans without delays,” Shamba stated.

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