primary housing

On Tuesday, August 4, the Minister of Justice met with the head of the association "On the Abolition of Real Estate Tax for Primary Property" and the authors of this initiative on the platform Estris Hiršsons, Chair of the Board of the Sarkandaugava Development Association Alija Turlaja, Member of the Board of the “Association of Apartment Owners and Lessors “Tauta pret zemes baroniem”” Gundars Ūderis to discuss the new cadastral valuation methodology developed by the Ministry of Justice and the draft law on the abolition of real estate tax for primary housing.

In the conversation with the representatives of the associations, the Minister of Justice Jānis Bordāns emphasized: "First, the new cadastral values cannot and must not enter into force until a real estate tax reform is completed that is clear and understandable to all citizens. Therefore, we also published the recalculated cadastral values much earlier than required by law on February 1 of the following year, so that every resident could get acquainted with them and give their opinion to the State Land Service. However, it is quite clear that the recalculated cadastral values will not be passed to the government without a complex real estate tax reform, within which a non-taxable minimum must be introduced for each person declared in the property! Because every inhabitant of Latvia has the right to housing that ensures physical security and does not create a disproportionate tax burden."

The representatives of the resident associations expressed their support to the introduction of a non-taxable minimum of 100,000 euros per declared person, as well as a reduction of the tax on residential land five times from 1.5% to 0.3%.  At the same time, the Minister of Justice and representatives of the associations agreed that after resolving the issue of abolition of real estate tax for primary housing, the termination of forced shared property and tax policy for businesses should be resolved.

Minister of Justice Jānis Bordāns: "We will continue to support the interests of the people and insist on the fair application of real estate tax. Compared to the Baltic States, Latvia is the least friendly to the population in terms of real estate tax, according to tax and financial experts. For example, in Lithuania, housing with a cadastral value not exceeding 220,000 euros is not taxed. In Estonia, the owner of a family private house does not have to pay tax on the land under the building up to 1,500 square meters. The tax burden on primary housing must not be increased disproportionately and a socially just decision must be made that is acceptable to every citizen. In addition, it is economically wrong to raise taxes during a recession. "