28 June 2012 -Latvian National News Agency LETA
The VAT rate in Latvia will be reduced from the current 22% to 21% on July 1 of 2012, according to amendments to the Law on VAT Rate which passed recently.
The reduction of the VAT rate from 22 to 21% this year will leave the budget with LVL 16.5 million less in revenue this year, and LVL 40.5 million less in revenue in 2013, according to the National News Agency LETA.
The Finance Ministry explained that reducing the VAT rate will improve Latvia’s competitiveness in the region and reduce the pressure of inflation on Latvia’s residents.
The lower VAT rate will also be closer to Lithuanian and Estonian VAT rates respectively 21% and 20% .