It is planned to continue to apply the current Latvian cadastral values at least until 31 December 2025. This is stipulated by the amendments to the law conceptually supported in the first reading by the Latvian Parliament on February 4.
The amendments set a task for the Cabinet of Ministers to prepare and submit to the Parliament for consideration draft laws ensuring re-evaluation of the amount of state fees related to cadastral value. Among other things, the amendments envisage drafting the laws necessary for the exemption of housing from real estate tax, determine the amount of real estate tax for compulsory shared property, as well as commercial areas and agricultural land.
“While the majority of the Parliament and the government has not agreed on a comprehensive review of the real estate tax system, which would ensure a fair and tolerable tax burden for population and entrepreneurs, the increase of cadastral values should not be allowed,” previously argued Juris Jurass (New Conservative Party), the Chairman of the Legal Commission which is responsible for the progress of the draft law in the Parliament.
In Latvia, the amount of real estate tax is related to the cadastral value of the property. Until now, cadastral values have been frozen to prevent an increase in Real Estate Tax (RET).
In order for the amendments to the Real Estate State Cadastre Law to enter into force, the Parliament must support such amendments in two more readings.
The currently valid cadastral values are calculated using real estate transactions for 2012 and 2013. The State Land Service (SLS) has been developing a new cadastral valuation methodology for several years. Therefore, since 2017, the cadastral values of properties have been frozen and are used, for example, in the calculation of RET and compulsory rent.
In 2017, the Parliament supported amendments to the law, which provided for the freezing of cadastral values of real estate until 2020. At the end of October 2019, it was decided to “freeze” cadastral values for another two years until 2022.
Information source: Latvian Public Broadcasting