Latvia introduces a VAT change from July 2026

Latvia has approved a temporary 12% VAT rate on essential foods like milk, bread, poultry, and eggs—excluding ultra-sterilized milk—effective July 1, 2026, to June 30, 2027, pending parliamentary approval to ease rising food costs.

Latvia’s government has approved a reduced value-added tax (VAT) rate of 12% on essential food products. The measure, announced earlier this week, will apply to items such as milk, bread, poultry meat, and eggs, with the notable exception of ultra-sterilised milk, which remains excluded from the milk category.

The reduced VAT rate is scheduled to take effect from July 1, 2026, and will remain in place until June 30, 2027. However, the proposal still requires parliamentary approval before it can be formally enacted.

If passed, the measure is expected to provide relief to Latvian consumers amid rising food costs, particularly benefiting low- and middle-income households.