Energy VAT policy in Latvia ‘unacceptable’
Thursday April 16, 2009
Latvia’s VAT policy for domestic and renewable energy resources is "discriminatory", according to one European advisor.
Juris Ozolins, advisor to the commissioner for energy and representative of the Libertas.Iv political union, said the Latvian parliament should look to change the policies.
The alterations to the tax policy were introduced at the end of last year by the country’s previous government and have increased energy costs and affected "nearly all households" in Latvia, he claims.
Mr Ozolins said: "It is unacceptable and absurd that the reduced 10 percent VAT rate applies to natural gas consumers, whereas the local fuel users have to pay 21 percent VAT."
European Union ministers are set to consider whether cross-border research projects in Europe could be exempt from VAT in the future.
According to the Financial Times, tax breaks for such projects would be introduced if two member states have legitimate and non-economic objectives for the research.