Drafted by the Budgetary and Fiscal Committee, endorsed by the Cabinet of Ministers and passed by Parliament, amendments to the VAT Act are waiting to be announced by the President of Latvia. The amendments are mainly related to changes in other pieces of legislation or meant to take over several VAT directives amending Directive 2006/112/EC on the common system of value added tax. This article explores what we see as key amendments.
 

When goods are supplied to a person in another member state, one might wonder how VAT should be properly applied if the customer has not presented his VAT registration number, yet he is known to be a trader. Is this an intra-Community distance sale or an intra-Community supply of goods? Since the VAT treatment varies, it is important to understand the features of each transaction.

The surge of online trading has more and more businesses not only selling their own goods but promoting sales of third-party goods through various electronic interfaces (e.g. marketplaces, platforms or portals). Under amendments to the VAT rules effective from 1 July 2021, in certain cases interfaces promoting third-party supplies are responsible for collecting VAT instead of the seller. This article explores cases in which the taxable person (interface) is considered to have acquired the goods and sold them on, becoming a deemed supplier.