copy the linklink copied!Latvia
Latvia has met all aspects of the terms of reference (OECD, 2017[3]) (ToR) for the calendar year 2018 (year in review) and no recommendations are made.
In the prior year report, Latvia received two recommendations. These recommendations have been addressed and are removed.
Latvia can legally issue three types of rulings within the scope of the transparency framework. In practice, Latvia issued rulings within the scope of the transparency framework as follows:
-
One past ruling;
-
For the period 1 April 2016 - 31 December 2016: one future ruling;
-
For the calendar year 2017: two future rulings, and
-
For the year in review: three future rulings.
Summaries of rulings are published in an anonymised way.1
No peer input was received in respect of the exchanges of information on rulings received from Latvia.
copy the linklink copied!Introduction
This peer review covers Latvia’s implementation of the BEPS Action 5 transparency framework for the year 2018. The report has four parts, each relating to a key part of the ToR. Each part is discussed in turn. A summary of recommendations is included at the end of this report.
copy the linklink copied!A. The information gathering process
Latvia can legally issue the following three types of rulings within the scope of the transparency framework: (i) preferential regimes;2 (ii) cross-border unilateral APAs and any other cross-border unilateral tax rulings (such as an advance tax ruling) covering transfer pricing or the application of transfer pricing principles; and (iii) permanent establishment rulings.
Past rulings (ToR I.4.1.1, I.4.1.2, I.4.2.1, I.4.2.2)
For Latvia, past rulings are any tax rulings within scope that are issued either: (i) on or after 1 January 2014 but before 1 April 2016; or (ii) on or after 1 January 2010 but before 1 January 2014, provided they were still in effect as at 1 January 2014.
In the prior year peer review report, it was determined that Latvia’s undertakings to identify past rulings and all potential exchange jurisdictions have met all the ToR. Latvia’s implementation in this regard remains unchanged, and therefore continues to meet the minimum standard.
Future rulings (ToR I.4.1.1, I.4.1.2, I.4.2.1)
For Latvia, future rulings are any tax rulings within scope that are issued on or after 1 April 2016.
In the prior year peer review report, it was determined that Latvia’s undertakings to identify future rulings and all potential exchange jurisdictions have met all the ToR. Latvia’s implementation in this regard remains unchanged, and therefore continues to meet the minimum standard.
copy the linklink copied!B. The exchange of information
Legal basis for spontaneous exchange of information (ToR II.5.1, II.5.2)
Latvia has the necessary domestic legal basis to exchange information spontaneously. Latvia notes that there are no legal or practical impediments that prevent the spontaneous exchange of information on rulings as contemplated in the Action 5 minimum standard.
Latvia has international agreements permitting spontaneous exchange of information, including being a party to the (i) Multilateral Convention on Mutual Administrative Assistance in Tax Matters: Amended by the 2010 Protocol (OECD/Council of Europe, 2011[4]) (“the Convention”), (ii) the Directive 2011/16/EU with all other European Union Member States and (iii) double tax agreements in force with 62 jurisdictions.3
Completion and exchange of templates (ToR II.5.3, II.5.4, II.5.5, II.5.6, II.5.7)
In the prior year peer review report, it was determined that Latvia’s process for the completion and exchange of temples met all the ToR, except for having in place the necessary regulatory framework to exchange information on rulings with jurisdictions other than EU Member States (ToR II.5.1) and the timelines by which information on rulings is provided to the Competent Authority for exchange of information (ToR II.5.5). Therefore, Latvia was recommended to finalise the amendments to their regulatory framework to allow exchange of information on rulings with non-EU Member States under the transparency framework as soon as possible and to reduce the timelines for providing the information to the Competent Authority.
During the year in review, Latvia finalised the amendments to the regulatory framework. The amended internal regulations stipulate that in respect of all rulings, regardless of the recipient jurisdiction, information will be sent within three months after the date on which the ruling was issued. Therefore, both of the prior year recommendations can be removed.
For the year in review, the timeliness of exchanges is as follows:
copy the linklink copied!C. Statistics (ToR IV)
The statistics for the year in review are as follows:
copy the linklink copied!D. Matters related to intellectual property regimes (ToR I.4.1.3)
Latvia does not offer an intellectual property regime for which transparency requirements under the Action 5 Report (OECD, 2015[5]) were imposed.
Notes
← 1. Available at: www.vid.gov.lv.
← 2. With respect to the following preferential regimes: 1) Shipping tax regime and 2) Special economic zones.
← 3. Parties to the Convention are available here: www.oecd.org/tax/exchange-of-tax-information/convention-on-mutual-administrative-assistance-in-tax-matters.htm. Latvia also has bilateral agreements with Albania, Armenia, Austria, Azerbaijan, Belarus, Belgium, Bulgaria, Canada, China (People’s Republic of), Croatia, Cyprus, Czech Republic, Denmark, Estonia, Finland, France, Georgia, Germany, Greece, Hong Kong (China), Hungary, Iceland, India, Ireland, Israel, Italy, Japan, Kazakhstan, Korea, Kuwait, Kyrgyzstan, Lithuania, Luxembourg, Malta, Mexico, Moldova, Morocco, Netherlands, North Macedonia, Norway, Poland, Portugal, Qatar, Romania, Russia, Montenegro, Serbia, Singapore, Slovenia, Slovak Republic, Spain, Sweden, Switzerland, Tajikistan, Turkey, Turkmenistan, Ukraine, United Arab Emirates, United Kingdom, United States, Uzbekistan and Viet Nam.
Note by Turkey: The information in this document with reference to “Cyprus” relates to the southern part of the Island. There is no single authority representing both Turkish and Greek Cypriot people on the Island. Turkey recognises the Turkish Republic of Northern Cyprus (TRNC). Until a lasting and equitable solution is found within the context of the United Nations, Turkey shall preserve its position concerning the “Cyprus issue”.
Note by all the European Union Member States of the OECD and the European Union. The Republic of Cyprus is recognised by all members of the United Nations with the exception of Turkey. The information in this document relates to the area under the effective control of the Government of the Republic of Cyprus.
Metadata, Legal and Rights
https://doi.org/10.1787/7cc5b1a2-en
© OECD 2019
The use of this work, whether digital or print, is governed by the Terms and Conditions to be found at http://www.oecd.org/termsandconditions.