Latvia Granted Extension for VAT Deduction Limit on Non-Business Passenger Cars Until 2027

• The European Commission adopted a decision authorizing Latvia to extend its deviation from certain articles of the VAT Directive
• Latvia can continue limiting input VAT deduction rights for expenses related to passenger cars not used exclusively for business purposes
• Taxable persons in Latvia are relieved from treating private use of such vehicles as supplies of services for consideration
• The authorization for the deviation is extended until Dec. 31, 2027, from Dec. 31, 2024
• Any further extension request must be submitted to the EC by March 31, 2027, along with a report reviewing the percentage applied.

Source: news.bloombergtax.com

Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.

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