Also, the bill envisages increasing the tax rates for light vehicles of companies by 10% from 2027.
It is intended to determine the deadline for the payment of the vehicle operating tax – January 31 of the year following the calendar year.
According to the amendments to the Road Traffic Law, which were adopted on June 22, 2023, from January 1, 2025, the first state technical inspection of a passenger car not previously registered in Latvia and abroad will be carried out no later than 36 months after the relevant vehicle was first registered in Latvia. while the second, third and fourth national technical inspections will be carried out every 24 months and then annually.
According to the calculations of the Road Safety Directorate (CSDD), the number of vehicles for which the vehicle operation tax will not be paid could increase by 60,000 units, as a large number of taxpayers are used to paying the vehicle operation tax for the vehicle before the state technical inspection.
In order to deal with the situation that has arisen, namely that the tax be paid regularly – every year – the draft law stipulates the deadline for the payment of the vehicle operation tax, which will be January 31 of the year following the calendar year.
According to the Road Traffic Law, the state technical inspection of most vehicles is carried out every 12 months. In order to ensure a full-fledged state technical inspection process and to smooth out the flow of state technical inspection of vehicles within a year, the permission to participate in road traffic can be set for longer than 12 months, but no more than 30 days, unless otherwise specified in the Road Traffic Law. This means that for a vehicle that passes the state technical inspection in December, for example in December 2024, the next state technical inspection deadline may very likely be set in January of the following year or in January 2026. Thus, January 31 of the year following the calendar year will be the deadline when the vehicle operating tax should have been paid for the taxation period.
The draft law envisages the obligation of CSDD to send an informative notice to inform taxpayers about the obligation to pay tax as a preventive measure. The informative notice will be sent every year by January 10. The information notice will inform those taxpayers who have not paid the vehicle operating tax by the time the notice is sent. This notification will also be received by those taxpayers whose state technical inspection deadline is set from January 10 to January 30 and the vehicle operating tax will not be paid until January 10.
The notice will be of an informative nature only and will not contain the features of an administrative act, it will remind you of the tax payment deadline and will have a link to the website where you can view vehicle operating tax rates. Thus, the “Consult first” principle will be realized with the help of the announcement.
According to the information provided by CSDD, 97% of registered users on the website “e-csdd.lv” have agreed to receive information electronically, therefore, to taxpayers who have given permission to send information electronically, the information notice will be sent in CSDD’s electronic services system. For other taxpayers, the information notice will be sent by post.
The CSDD states that the number of vehicles for which the vehicle operation tax has not been paid ranges from 135,000 to 140,000 units. Taking into account the information provided by CSDD, without introducing the new legal regulation, the number of light vehicles not previously registered in Latvia and abroad, for which the tax will not have been paid, could increase by 60,000 units, thus making a total of approximately 200,000 vehicles.
CSDD also predicts that it would be possible to send the electronic information notice to approximately 172,000 vehicle owners, while it would be necessary to send the information notice by mail to approximately 28,000 vehicle owners.
The rates of vehicle operation tax and company light vehicle tax are set as a constant number, and not expressed as a percentage, as with most taxes, therefore the rates of this type of tax remain unchanged, despite changes in the consumer price index, explains the FM. The indexation of vehicle operating tax rates was last performed in 2021. On the other hand, the tax rates for light vehicles of companies were revised in 2023.
Taking into account that the rates of vehicle operation tax and company light vehicle tax are not expressed in percentage terms, they remain unchanged even in a situation when inflation increases, unlike other taxes, whose changes are directly affected by inflation, thus it is necessary to review the vehicle operation tax at certain time intervals tax and light vehicle tax rates and index them according to the amount of inflation increase. In compliance with these conditions, the draft law provides that the vehicle operating tax and company light vehicle tax rates are increased, taking into account the changes in the consumer price index, starting from 2021, which amounts to approximately 10%.
Therefore, both the vehicle operating tax and company light vehicle tax rates are indexed by an average of 10%.
As the company light vehicle tax rates have been changed in 2023, the norms for the indexed rates of this tax will enter into force in 2027.
It is planned that the changes in vehicle operating tax rates will come into effect from January 1, 2025.
The bill is being advanced in the package of accompanying bills “On the state budget for 2025 and the budget framework for 2025, 2026 and 2027”.
2024-10-01 20:47:18