Latvia, Legislation, Markets and Companies, Taxation

International Internet Magazine. Baltic States news & analytics Thursday, 28.03.2024, 17:36

Latvian Saeima approves keeping 9% microenterprise tax in place

BC, Riga, 26.03.2015.Print version
Reviewing the bill on microenterprise tax in the second reading today, Saeima decided that the rate would remain 9% during a three-month period after a microenterprise is established, provided that the question of compulsory social contributions paid by employees is solved, informs LETA.

If no mandatory social contributions are introduced for microenterprises' employees, the tax rate will be gradually raised, starting next year.

 

55 coalition MPs voted for the bill, six members of the Alliance of Regions of Latvia voted against, 21 abstained, and three did not participate in the vote. Among those abstaining were Harmony's MPs and Romans Naudins from All For Latvia-For Fatherland And Freedom/LNNK.

 

The bill will be reviewed in the final reading on April 16, MPs' proposals will be accepted until March 31.

 

Today, Saeima approved a proposal from Karlis Sadurskis (Unity) that the government would have to draw up amendments to the law on social insurance by September 30, under which microenterprises' employees would be covered by social insurance and make social contributions that would be calculated based on the minimum monthly wage level.

 

If the government does not do this, microenterprise tax for enterprises with annual turnover from EUR 7,000 to EUR 100,000 will be 13% from January 1 next year, and from 2016 – 15%.

 

If the question of microenterprise employees' social contributions is resolved, the microenterprise tax will be 9% during the first three years since the establishment of the company, and 12% after that.

 

Saeima first amended the Microenterprise Tax Law in November 2013, deciding to increase the microenterprise tax rate to 15% by 2017. According to the amendments, the tax rate for microenterprises with annual turnover under EUR 7,000 would remain 9%. The tax rate for microenterprises with higher turnover was to increase to 11% in 2015, 13% in 2016 and 15% in 2017.






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