- The reduced VAT rate of 5% for fruits and vegetables produced in Latvia is likely to be abolished next year.
- The reduced VAT rate was introduced as a pilot project in 2018 and was planned to last for three years.
- The Ministry of Agriculture concluded that the criteria for maintaining the reduced VAT rate had been met.
- The Finance Ministry disagreed and believed the pilot project was not successful.
- The government agreed to maintain the reduced VAT rate until autumn 2023.
- Fruit and vegetable prices did not decrease due to the reduced VAT rate, but it helped local producers and fought against the shadow economy.
- The previous government did not extend the application of the reduced VAT rate, and a full 21% rate is planned for next year’s budget.
- An additional EUR 3 million will be allocated to help fruit and vegetable producers with investments to increase competitiveness and export capacity.
Source: eng.lsm.lv
Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.
