Latvia’s President Raimonds Vejonis has promulgated two legal amendments that the country’s legislature, the Saeima, adopted on December 20, 2016; the changes came into effect on January 1, 2017. The changed laws cover the taxation of microenterprises and the social security system. The following tax regime for the micro-enterprise tax payers was approved:
- no minimal social insurance contributions (this tax is included in the micro-enterprise tax);
- increase of micro-enterprise tax rate from 9% to 15% from the turnover for companies with the turnover between EUR 7 001 and EUR 100 000 per year;
- increase of micro-enterprise tax rate from 9% to 12% from the turnover for the smallest businesses with yearly turnover of up to EUR 7 000 (this reduced rate is valid only for year 2017).
Additional changes include eliminating the deadline for registering as payers of the microenterprise tax, which had been set as June 30, 2017, and permitting existing microenterprise tax payers to continue in the status beyond the previous limit of December 31, 2018, without registering as corporate or personal income tax payers by December 15, 2018, as had been required.
