Latvia | Tungsten Network

VAT reduction on food products

Ryan Golds — Fri, 27 May 2022 11:11:43 +0000

In response to rising costs, the Latvian government is proposing to reduce VAT on food. Such a reduction is expected to amount to a deficit of 100 million Euros in the State Budget, following trends across the Europe.

We expect further clarity from the Latvian government regarding specific details around VAT reductions.

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Proposed VAT reduction

Ryan Golds — Thu, 28 Apr 2022 07:32:09 +0000

Inflation continues to bite in many European countries. Latvia is no exception – and has been forced to address its fiscal operations considering this.

To this effect, the Latvian Parliament is considering a VAT reduction on basic foodstuff to 5%.

If passed in Parliament, this VAT reduction is expected to come into force on 1^st July 2022 and last for some duration- until 30 June 2024.

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Energy-related tax reductions

Ryan Golds — Fri, 04 Feb 2022 00:00:00 +0000

In line with what we’re seeing across Europe, Latvia’s governing coalition parties will meet to discuss reducing the VAT on energy from 21% to 5%. This is a significant reduction and shows the pressure governments are under to try and tackle rising inflation, amongst other issues.
This has not yet been implemented but the government should indicate their intentions over the coming weeks.

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Introduction of mandatory e-invoicing

Ryan Golds — Fri, 12 Nov 2021 00:00:00 +0000

The Ministry of Finance prepared an informational report on “Adopting a System of Electronic Flow of Supporting Documents and Waybills”, debated and endorsed on 12 October 2021, which mandates the use of electronic supporting documents and e-invoices by 2025. It is expected that E-invoicing will be mandatory for B2B and B2G transactions.
The Ministry of Finance in Latvia has been seeing the benefits in other countries in following a total or partial flow of e-invoices, and is hoping to incorporate similar benefits as a result of a more digital society.

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