Tax approximation is a central obligation under the EU-Georgia Association Agreement and the Deep and Comprehensive Free Trade Area (DCFTA). This thesis examines Georgia’s legal obligations regarding VAT and customs regulations, the extent of legislative alignment with EU standards, the interaction between VAT and customs rules in cross-border trade, and the practical implementation challenges that constrain effective approximation. Through doctrinal and comparative legal analysis of the EU VAT Directive, the Union Customs Code, the Georgian Tax Code and the Georgian Customs Code, as well as qualitative policy analysis of EU progress reports and governance assessments, this thesis reveals substantial formal alignment in key areas, such as taxable persons, VAT rates, customs valuation, and inward processing. However, significant divergences remain, including zero-tariff treatment for qualifying EU-origin goods under the DCFTA, while import VAT at 18% continues to apply to all imports regardless of origin, a lower registration threshold, the qualified/non-qualified VAT payer distinction, and broad import duty exemptions. Practical implementation is further constrained by operational failures in the New Computerised Transit System (NCTS), a plateaued shadow economy, legal uncertainty, and governance challenges. The thesis concludes that formal legislative approximation does not automatically ensure functional equivalence and recommends targeted reforms to administrative capacity, judicial specialization, and governance.