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Short description of taxes of Republic of Latvia
Below are described taxes of Republic of Latvia, to give short information about payers of taxes, objects of taxes and tax rates in most common cases. In some cases applying of taxes may be different from described in this page. So it is necessary to get to know circumstances of each case, to state how taxes must be applicable.
Personal income tax. Tax payers are natural persons. Object of tax is income received by natural person. Rate of tax for income of employees is 26%. Natural persons, doing commercial activities can choose to pay fixed tax (in cases prescribed in legal norms) or to pay income tax 26% from income. In law are prescribed several incomes not applicable by personal income tax.
Company income tax. Payers are domestic companies (limited liability companies, joint stock companies), foreign companies, natural persons (if income is not applicable by personal income tax) and other persons, and representation of foreign company. Tax rate is 15% from applicable income.
Immovable property tax. With immovable property tax are applicable material things (objects) which are located in Republic of Latvia and which can not be relocated from one place to another without damaging them (in laws are prescribed several exceptions when such things are not applicable with immovable property tax). Payers of immovable property tax are natural and legal persons, and on basis of agreement established groups of natural and legal persons, which owns (possess) immovable property. Immovable property tax rate is starting from 0,1 percent from cadastral value of immovable property tax.
Value added tax. Transactions applicable with value added tax are following transactions, which are performed for reward, doing commercial activities in inland (territory of Republic of Latvia): sale of goods, rendering of services and self consumption. In territory of European Union with value added tax applicable transactions are also purchase of goods in (from) territory of European Union and purchase of new cars by non applicable persons. Import of goods also is applicable with value added tax. Tax is withhold and paid by persons which are registered in register of persons applicable with value added tax. Basic rate is 21%, reduced rate is 10%. Export and dealings described in legal norms are applicable with 0% rate.
Mandatory State Social Insurance Contributions (social contribution payments). Object is income of natural person. Tax must be paid for income of person which is socially insured person. Socially insured persons are also employees and self employed persons. Basic rate of social contribution payments is 33,09%, 9% are deducted from income of employee and 24,09% additionally pays employer.
In legal norms of Republic of Latvia are prescribed also following taxes:
Excise tax
Customs duty
Natural Resources tax
Lottery and Gambling tax
Tax on cars and motorbikes
Tax on electricity
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