Latvia's Administrative Regional Court upheld a VAT refund of EUR 143,844 for German firm Bauer Spezialtiefbau GmbH, ruling that a refund cannot be denied solely on the assumption of foreign business activity without evidence of taxable transactions. The decision also clarified the distinction between a permanent establishment for corporate income tax and a fixed establishment for VAT in Latvia.
The VATfaqs digest
Global VAT news, delivered Tuesday and Thursday. Free, curated from 50+ official sources, no spam.
No spam · Unsubscribe any time
VATcube · about 1 month ago
Latvia will introduce a temporary 12% VAT rate on essential food products from 1 July 2026, while the standard rate remains 21% and a 5% super‑reduced rate applies to specific categories. Businesses must update invoicing, ERP, and VAT return processes before the effective date to avoid compliance issues.
BNN News · about 2 months ago
Latvia will lower the VAT rate on a range of essential food items from 21% to 12% effective 1 July 2026, following an agreement between the Ministry of Economics and retailers. The change covers bread, milk, poultry products, eggs and flour, and is designed to be fully reflected in consumer prices. The move is part of a broader low‑price basket initiative aimed at easing food costs for residents.
Bloomberg Tax · 5 months ago
Latvia's parliament has accepted Bill No. 1206 for consideration, which proposes reducing the VAT rate on firewood and thermal energy for household use from 12% to 5% between Jan. 1 and April 30, 2026. The bill also requires that invoices issued at the 12% rate during that period be corrected by the law’s entry‑into‑force date.
VatCalc · 6 months ago
Latvia has increased its Intrastat reporting thresholds for 2024, raising the Arrivals threshold to €380,000 and the Dispatches threshold to €220,000. These new thresholds will take effect on 1 January 2026, aligning Latvia with updated EU Intrastat reporting requirements.
SNI Technology · 6 months ago
Latvia’s Cabinet Regulation, effective 1 January 2026, mandates structured electronic invoicing and reporting to the State Revenue Service (SRS) for all B2G, G2B, and G2G transactions, with B2B reporting becoming mandatory from 1 January 2028. The regulation specifies four delivery channels—e‑adrese, certified service providers, EDI, and email—each linked to a distinct SRS reporting method and requires XML invoices in UBL 2.1 or Peppol BIS Billing 3.0. Invoices must be reported within five working days of issuance, with contingency rules for technical disruptions.
Innovate Tax · about 3 hours ago
The article summarises recent VAT and customs duty changes across the EU, UK, Poland, Austria, Spain, Denmark, Nigeria, Gibraltar, Argentina and Ireland.
Put your brand alongside trusted tax-tech intelligence across 150+ countries.
Key Takeaways
The Latvian Administrative Regional Court, on 16 July 2026, ruled that a VAT refund cannot be denied solely on the assumption that a foreign business carried out taxable activities in Latvia, and the tax authority must provide evidence of taxable transactions.
The court, on 16 July 2026, clarified that a permanent establishment for corporate income tax purposes is distinct from a fixed establishment for VAT purposes in Latvia.
The court upheld a VAT refund of EUR 143,844 for Bauer Spezialtiefbau GmbH on 16 July 2026.
Primary source
Read the full article at TaxandThis summary was published on VATfaqs.com on 18 July 2026. It relates to VAT developments in Latvia. The original source is Taxand.
