On 26 September 2023, the Latvian Ministry of Finance released an official statement announcing that the Cabinet of Ministers has reviewed an informative report on developing the National Tax Policy Guidelines for 2024-2027.
The report includes proposed tax measures as part of the 2024 Budget. These measures include introducing a new 20% tax on banks and non-bank creditors. This tax would be based on their profit from the previous year. The proposal also includes changing the micro-enterprise tax regime from a two-rate system (25%/40%) to a single rate of 25%. It increases the VAT registration threshold from EUR 40,000 to EUR 50,000. Furthermore, the budget proposes to revise the natural resource tax to include higher vehicle rates, household and hazardous waste disposal, and natural resource extraction.
The new tax policy aims to facilitate progress toward Latvia’s macroeconomic objective, necessitating an annual economic growth rate of at least 5%. This is crucial for ensuring sustainable economic development and continuous improvement in the well-being of Latvia.
The proposed legislation for these measures will be presented to Parliament in early November 2023.
