How VAT (PVN) Works in Latvia (2026): 21% Standard, 12% and 5% Reduced
Latvia applies value added tax (pievienotas vertibas nodoklis, PVN) at a standard rate of 21%, a reduced rate of 12% (medicines, public transport, accommodation and certain foods) and a super-reduced 5% (books and the press). Businesses register once taxable turnover passes the threshold. Verify rates and thresholds with VID (vid.gov.lv).
The three PVN rates
Standard rate 21% applies to most goods and services. Reduced rate 12% covers medicines and medical devices, public passenger transport, tourist accommodation, heating for households, and certain fresh foods (a pilot has applied 12% to items such as bread, milk, eggs and poultry). Super-reduced 5% applies to books, newspapers and periodicals. Some supplies are exempt (financial services, healthcare, education, residential rental) and exports are zero-rated. Confirm the correct rate for a specific item with VID.
Registration and returns
A business must register for PVN once its taxable turnover exceeds the registration threshold (historically EUR 40,000 over 12 months); voluntary registration is possible below it. Once registered, a business charges PVN on sales, deducts input PVN on purchases, and files periodic returns remitting the net amount. Confirm the current threshold and filing frequency with VID.
FAQ
What are Latvia's VAT rates in 2026?
Standard 21%, reduced 12% (medicines, transport, accommodation, certain food) and super-reduced 5% (books, press). Exports are zero-rated and some services are exempt. Verify the classification of your goods with VID.
When must a business register for VAT?
Once taxable turnover exceeds the registration threshold over a 12-month period; voluntary registration is available below it, which can help if you incur significant input VAT. Confirm the current threshold with VID.
⚠️ Informational estimate, not tax advice. Payroll software may differ in edge cases. Verify with a professional.