The sanctioned persons who own real estate in Latvia will no longer receive real estate tax relief, including in free ports and special economic zones, as of 1 July this year. This is established by amendments to the law On Immovable Property Tax, adopted by the Saeima in the final reading on Thursday, 21 March.
The amendments state that the rates for the real estate of sanctioned persons in Latvia will no longer be determined by local governments, but this property will be subject to a tax rate of 10 per cent of the cadastral value of the real estate.
At least 80 per cent of this tax revenue will be channelled by local governments to support Ukrainian civilians who, due to Russia’s full-scale military invasion of Ukraine, have left their homeland, cannot return there, and have settled in Latvia.
It is also stipulated that the sanctioned persons will no longer benefit from the real estate tax exemptions, as well as they will no longer benefit from tax credits.
Considering that local governments have already sent notices regarding the calculated real estate tax, they will recalculate the amount of tax and will send an updated tax payment notice by 15 July this year.
If a sanctioned person has delayed payment of the real estate tax, local governments have been granted the right to commence recovery of the tax debt on an uncontested basis within three months.
According to the explanatory note to the amendments, it is expected that the total real estate tax revenue of local governments could increase by 1.9 million euros.
Amendments to the law On Immovable Property Tax have been made to prevent persons who have been designated as subjects of sanctions in accordance with the Law on International Sanctions and National Sanctions of the Republic of Latvia from using the existing real estate tax reliefs.
Saeima Press Service