“Last year the Union of Greens and Farmers (ZZS) submitted to the Saeima the proposal to reduce VAT for multiple food products twice. After entering the government, however, the party no longer maintains this proposal, said Minister of Agriculture Armands Krauze in an interview to Latvijas Radio.
He explained that ZZS will definitely not initiate this discussion in the development of the 2024 budget project. This is because the switch of the government has caused the document to be delayed. According to Krauze, “there are other issues highly important to Latvia’s residents, such as electricity tariffs and other problems that need resolving and are no less important”.
The minister also said that in the future, when discussing reduced VAT rates, it will be necessary to consider
“whether these rates contribute to the popularity of imported products”.
Krauze claimed in his interview that, for example, the reduction of VAT for Latvian fruits and vegetables in 2008 caused “a massive surge of imported products, basically – by lowering the rate, we had promoted consumption of imported goods in Latvia. This is not our objective – we want to help local producers.”
Latvijas Radio reminds that when ZZS faction in the Saeima was in opposition, they offered setting VAT at 5% and then at 0% starting with the 1st of June 2022: for milk with a shelf life of up to 10 days; dairy products – including sour cream, cream, kefir, curdled milk, buttermilk, whole milk curd, cottage cheese, skimmed milk curd, yoghurt; fresh bread with no additives; fresh and chilled meat and fish; chicken and quail eggs in shells.
Also read: Latvian government approves massive tax changes for next year