Court rules VID's VAT audit unlawful, awards company €5,000 in compensation
Latvia's Administrative Regional Court has ordered the State Revenue Service to pay a company €5,000 for non-material damage and cover its legal costs. The reason is a VAT audit lasting almost two years, which the court found unlawful.
Latvia's Administrative Regional Court has ordered the State Revenue Service (VID), the country's tax administration, to pay a company €5,000 in compensation for non-material damage and to cover its legal expenses. The ruling concerns a value-added tax (VAT) audit that lasted nearly two years and that the court found to be unlawful. The audit significantly hampered the company's operations. The news was published by the portal Apollo.lv on 15 November.
Violations identified by the court
In its judgment, the court pointed to a series of violations by VID. These include unjustified delays in the proceedings and the disproportionate use of security measures against the company. The court also found that the service had failed to eliminate risks linked to an information leak and a possible attempt to extort a bribe from the company.
What it means
The judgment means the business owner has obtained compensation through the courts for actions by the tax authority that were deemed unlawful. The source does not name the company or its sector, and it does not say whether VID will appeal the ruling.
