Latvia's anti-inflation plan could include lower VAT on food

The Ministry of Economics (EM) is currently working on anti-inflation measures, including assessing the possibility of reducing the value-added tax rate (VAT) for food and excise duty on fuel, Minister for Economics Ilze Indriksone (National Alliance) said at a briefing on August 5.

One of the measures assessed in the anti-inflation plan is to reduce the VAT rate from 21% to 5% for fresh fish and fresh meat, as well as bread and dairy products. The application of the reduced 5% VAT rate to catering companies is also assessed.

It is also considered that excise duty on fuel could be lowered and the electricity procurement component (OIK) abolishment, as well as the compensation of the electricity distribution tariff.

The Minister refrained from explaining the plans more broadly, indicating that work on them was still continuing. However, the measures of the future plan focus not only on inflation slowing, but also on maintaining business competitiveness and sustainability.

 

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