December 9, 2021. The parliament of the Republic of Latvia, Saeima, passed in the first reading amendments to the Law on Excise Tax. The goal of these amendments is reducing excise tax for natural gas, improving accessibility of refueling stations for vehicles powered by gaseous fuels, as well as developing gas infrastructure.
The goal of amendments to the Law on Excise Tax is replacing the previous state support mechanism in accordance with de minimis regulation on the general reduced tax rate and thereby continue promoting reduction of greenhouse gas emissions in transport and gradual transition towards environmentally friendly fuels.
The legislative draft provides for reducing the excise tax rate for natural gas used by vehicles until December 31, 2025. It also states that the regulation in accordance with which the excise tax rate for vehicle fuel remains at 1.91 EUR/MWh or EUR 20 per 1,000 cubic meters will remain in place until 2025, as well as replacing the previously outlined state support form with a general reduced tax rate of 1.91 EUR/MWh or EUR 20 per 1,000 cubic meters.
The legislative draft will come to force once a decision from the European Commission on compliance of this support mechanism to EU’s domestic market has been received.
