- Objective: Extend Latvia’s special VAT measure limiting input VAT deduction on passenger cars not wholly used for business.
- Current Measure: Limits VAT deduction to 50% and exempts private use from being treated as a supply of services.
- Justification: Simplifies VAT collection, reduces administrative burden, and prevents tax evasion.
- Duration: Proposed extension until 31 December 2027, with a review report due by 31 March 2027.
- Consistency: Similar measures have been granted to other EU Member States.
Source ec.europa.eu
