VAT schemes employed by used car dealers, including registration of private cars, cause losses worth approximately EUR 55 million annually, said the head of Automotive Association Andris Kulbergs at a meeting of the Economic, Agricultural, Environmental and Regional Policy Committee on Tuesday, the 14th of February.
The committee viewed amendments to the Road Traffic Law, which were developed to raise the efficacy of State Revenue Service’s (VID) tax administration measures and reduce the proportion of grey economy in the used cars market.
Kulbergs explained that
VAT schemes have been employed in the used cars market for years.
He also said that law amendments will not change much for private persons who purchase cars in foreign countries for personal use.
A representative of the Ministry of Finance explained at the meeting that private persons performing first-time registration of vehicles in Latvia often involve legal persons in order to hide income gained from business operations.
New requirements will make it mandatory for people to submit information about the purchase price and the seller to the Road Traffic Safety Directorate (CSDD) when registering used cars brought in from a EU member state.
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