Latvia to temporarily reduce VAT on some food products

The Latvian Parliament (Saeima) has adopted amendments to the Law on Value Added Tax (VAT), which will reduce the VAT rate on some food products by 12% for one year from mid-2026.

The amendments were adopted to mitigate the impact of rising food prices on public welfare. VAT at 12% will apply from next year to rye, wheat, gluten-free and flour-mixed breads, as well as to a wide range of other baked goods. Exceptions will be made for muffins, cakes, croissants and other pastries, as well as crisp pastry, breadcrumbs, toast and breadsticks.

In addition, the VAT rate will be reduced for fresh, sterilised or pasteurised milk from cows, sheep and goats, but will not be reduced for milk treated at high temperatures or condensed.

The reduced VAT rate will also apply to fresh and chilled poultrymeat, as well as fresh poultry eggs, but will not apply to frozen poultrymeat.

In addition, the adopted amendments provide that from January 2026, a 5% VAT rate will apply to printed and electronic books and periodicals, including online periodicals, if they are published in Latvian, Latgalian or Livonian, as well as in other official languages of the European Union and OECD member states.

The law is included in the package of draft laws accompanying the 2026 budget.