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By delaying these disputes, the government has ignored the law. The new cadastral values had to be approved by the Cabinet of Ministers by 31 July. It is determined by the Law on the State Cadastre of Real Estate, where this term was once initiated by the Minister of Justice Jānis Bordāns (JKP), who is responsible for the new cadastral calculations. However, it was in mid-July that he announced that they would not be referred to the Cabinet of Ministers for adoption until there was an offer to change the real estate tax in the new situation.
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The tax models should be developed by the Ministry of Finance, but the Minister of Finance Jānis Reirs (JV) this week referred to the government’s decision in October 2019 that work on the tax model should start after the cadastral values were approved by the Cabinet of Ministers. However, the principle is clear – in proportion to the increase of the cadastral value, the tax rate should decrease. However, a concrete offer remains to be seen. “We are patiently awaiting these cadastral values and as soon as the government approves them, we will carry out our assigned work, involving, as stated in the decision, the Ministry of Justice, the Ministry of Local Government, the Ministry of Agriculture – the widest circle,” Reirs said.
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The Ministry of Justice does not deviate from the idea that the tax offer should come first anyway. And it seems that this will be the position of the whole government, which, despite what the party member himself – the Minister of Finance said, was confirmed by the Prime Minister in the program “Morning Panorama” on August 12, where he said: “Under my leadership, the government will not accept to approve cadastral values in the absence of new, debated and acceptable new tax rates. “
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Explaining the different positions with the Minister of Finance, the Prime Minister’s Office later pointed out that the offer of the Ministry of Finance would still be before the approval of the cadastral values and it would be in September.
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It is already clear that it will be difficult to reach an agreement in any case. The already announced offer of the New Conservative Party – for a non-taxable minimum for housing – 100,000 euros for each declared – is criticized by all other coalition partners. The Minister of Economics Jānis Vitenbergs (KPV LV) emphasizes that this will mean a greater burden on entrepreneurs, who will have to carry this big discount on one shoulder. “It simply came to our notice then. Industrial parks as production buildings,
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hotels – this REN payment has become up to three times more expensive and it would be a disaster in such circumstances, ”he explained.
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The total tax burden for business objects would thus increase by 120% or 54 million euros, but for production facilities by 50% or 11 million euros. For hotels in Riga, the tax increase could reach 230%. The Ministry of Justice opposes that it is already possible to offer discounts for this type of property, but it should be offered to the Ministry of Finance. However, the parties represented in the coalition argue that the revenue from this tax should not be left at all.
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“Of course, it seems very sympathetic – not everyone pays anything. Does most cost nothing. This is the case from the assumption that the state is some abstract formation, where the Minister of Finance only has to take money from the locker and now cover all needs, ”says Imants Parādnieks, a member of the National Union, who also participated in party discussions on possible changes in real estate tax. .
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The National Association has its own offer – a tax on three components – premises – 20 cents per square meter, land – 2 cents per square meter, adding 0.2% of the cadastral value. This would reduce the impact of the cadastral value, as they can currently be as high as 1.5%. In addition, in order not to change the tax, the cadastral value would not change during one owner’s time – it would be revised only when selling the property. It is not the case that the party is very strict with this variant.
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“Development / About!” Is also ready for compromises. Instead of big discounts, some groups out there tend to support reduced rates, but all. However, it is too early for a specific assessment. “Without a joint offer from Mr. Bordāns, Mr. Reira and Mr. Kariņš on what to do with real estate tax policy, without value maps and proposed models, we are participating in an abstract discussion,” said Minister of Environmental Protection and Local Government Juris Pūce (A / P)
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An increase in the levy, which would be inevitable if the tax were not changed, is not the only reason for a review. A topical problem is the very different discount policy in different municipalities. Currently, the state sets real estate tax rates – from to and in some mandatory discounts, such as 90% discount for the poor and 50% discount for large families. The rest is determined by the municipalities at their own discretion.
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