Readiness for VAT reduction on food confirmed – pilot project starts July 1
During a working seminar at the Ministry of Economics, all involved parties confirmed their readiness to apply a reduced VAT rate of 12% on bread, fresh milk, poultry meat, and eggs from July 1, 2026 to June 30, 2027.
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On Thursday, June 18, the Ministry of Economics (MoE) held a working seminar with public administration institutions and industry partners to discuss practical preparations for reducing the value-added tax (VAT) on food. All parties confirmed their readiness for the pilot project, which will apply a reduced VAT rate of 12% from July 1, 2026, to June 30, 2027.
The reduced rate will apply to four product groups: bread, fresh milk, fresh chilled poultry meat, and eggs. Participants included representatives from the MoE, the Ministry of Agriculture, the Central Statistical Bureau (CSB), the Competition Council (KP), and the Consumer Rights Protection Centre (PTAC), as well as industry organisations and companies such as the Latvian Chamber of Commerce and Industry, the Latvian Food Retailers Association, the Latvian Merchants Association, the Latvian Food Industry Federation, the Farmers' Saeima, the Central Union of Latvian Dairy Farmers, and major retailers.
State institutions reported on their readiness to ensure monitoring, supervision, and public information measures. CSB head Raimonds Lapiņš stressed that official statistics will objectively show whether the reduction reaches consumers. KP chair Ieva Šmite informed that the council will conduct targeted market monitoring, analysing not only retail transaction data but also purchase prices and margin dynamics to prevent the reduced rate from becoming an additional profit source.
PTAC director Zaiga Liepiņa noted that an informed consumer is a key condition for fair tax implementation. PTAC has developed a special calculator that will allow anyone to calculate how much a product should cost after the VAT reduction. Informational materials will also be prepared.
At the seminar's conclusion, all parties agreed that the common goal is to achieve a direct and tangible price reduction for the population. Participants emphasised that only honest and coordinated action among the state, producers, and retailers will fully achieve the pilot project's objective of improving purchasing power.
