Proposed Amendments to Streamline Tax Regulation and Improve Tax Administration
Ministry of Finance Proposes Amendments to the Law “On Taxes and Duties” to Simplify Regulation and Improve Tax Administration
The Ministry of Finance has prepared amendments to the Law “On Taxes and Duties” aimed at simplifying the regulatory framework, reviewing outdated legal provisions, and improving tax administration. The draft law was submitted for public consultation on the Unified Legal Acts Portal on Thursday, 30 April.
The amendments propose to streamline the terminology used in the law and remove provisions that are no longer relevant or are rarely applied in practice. These include regulations concerning the capitalization of tax debts, which were linked to privatization processes, as well as outdated requirements allowing taxpayers to review legal acts in person at tax administration offices.
At the same time, the duties of taxpayers and tax authorities are being clarified in order to make the regulation clearer and easier to apply. For example, it is specified that tax returns must be submitted not only within the deadlines established by legislation but also within any extended deadlines granted by the State Revenue Service (SRS), taking into account that the legal framework allows for such extensions. In addition, provisions are being updated to reflect modern terminology and align with other legislative acts.
The draft law also introduces improvements to administrative procedures. It is planned to allow certain warnings and notices to be issued electronically without the signature of an official, thereby reducing the administrative burden.
The amendments further provide for the removal of requirements that have lost their practical significance. For example, the regulation requiring an individual taxpayer to obtain a payroll tax book and submit it to the employer regarded as the primary source of income is to be abolished. The current regulation governing payroll tax books is already contained in the Law “On Personal Income Tax” and related Cabinet regulations.
In addition, the approach to publishing information on tax-related violations is being improved. In the future, information will be published only about legal entities whose officials have been subject to administrative penalties for the payment of undeclared wages. This measure is intended to enhance transparency while ensuring the protection of personal data.
The amendments also seek to modernize the regulation of e-commerce supervision by establishing procedures consistent with the legal framework governing the restriction of illegal online content and requests for information from intermediary service providers, including measures relating to domain name restrictions and access blocking. For example, the procedures applicable when a supervisory authority adopts a decision restricting illegal online content are being clarified. This will ensure compliance with European Union requirements and improve the effectiveness of supervision in the digital environment.
Overall, the amendments are aimed at creating a modern, clear, and efficient tax framework that reduces the administrative burden while strengthening supervisory capabilities.
The public consultation period runs until 14 May of this year, and members of the public may submit comments and proposals through the Legal Acts Portal (TAP).
Following the conclusion of the public consultation and the assessment of the comments received, the draft law will be submitted for interinstitutional coordination through the TAP portal. After completion of this coordination stage, it will be submitted to the Cabinet of Ministers for consideration. Subject to Cabinet approval, the draft law will then be forwarded to the Saeima for review.
Information provided by the Ministry of Finance of the Republic of Latvia.