The association claims that in 2022, the state budget has lost €135 million in value-added tax revenues and €58 million in personal income tax and social security contributions revenues in the car repair sector.
Compared to the results of the 2020 study, the shadow economy in the garage sector has grown by 25%, the association concludes.
The Association sees the solution in the introduction of a voluntary certification system for garages, which would introduce and develop common standards for the sector in the country.
Andris Kulbergs (AS), Chairman of the Board of the Automobile Association and Member of the Saeima, points out that garages in Latvia operate in two different realities - those that try to work honestly and those that operate "outside the law".
"For years, up to 90% of the shadow economy in the garage sector has completely distorted competition, resulting in businesses being unable to develop, virtually all service network companies leaving the market and no new ones emerging because it is virtually impossible to work honestly. To solve this huge problem, it is not enough to punish garages, but there must be an effective state solution to make honest garages more competitive," Kulbergs aaid.
