Authorities are satisfied with the results of the VAT reduction. But are consumers satisfied? 0 65

According to the minister, the main goal of the reform has been achieved — prices for essential products have decreased by at least the planned 7.4%.

Summarizing the first month, Valainis noted that milk has become noticeably cheaper — its price has decreased by an average of 8.4%, which exceeds the initial forecast by one percentage point. The price of poultry meat decreased by 7.8%, bread by 7.7%, and eggs by 7.5%.

The minister emphasized that it is now important to maintain the reduced VAT rate not as a temporary measure, but to make it permanent.

He stated that the tax reduction helps not only consumers but also domestic food producers. Due to the increase in demand, enterprises have the opportunity to increase production volumes, which positively reflects on the country's economy as a whole.

"Already after a month, we see obvious benefits for society and the economy of Latvia. All participants in the process have fulfilled their tasks, which has led to this result," said Valainis.

The executive director of Rīgas piena kombināts, Arturs Chirevskis, noted that producers view the VAT reduction as the first step towards extending the reduced rate to other categories of food products.

In turn, the director of the Consumer Rights Protection Center (PTAC), Zaiga Liepina, reported that after the introduction of the reduced rate, the agency began inspections of retail outlets. During the first inspections, 55 stores were checked, and violations were identified in ten of them.

After consultations with PTAC, retail enterprises voluntarily committed to rectify the identified discrepancies. Follow-up inspections showed that most violations have already been corrected.

The executive director of the Latvian Association of Food Traders, Janis Dubults, confirmed that the price reduction has significantly increased demand.

According to retail chains, sales of chicken meat have increased by at least 15%, milk by 10%, eggs by 11%, and bread by 9%.

Dubults believes that the government should continue to use the VAT reduction mechanism, as it simultaneously reduces residents' expenses and stimulates economic activity. He also supported the proposal to make the reduced rate long-term and extend it to a wider range of products.

It should be noted that starting from July 1, the VAT rate on four main food groups — bread, milk, poultry meat, and eggs — was reduced from 21% to 12%. This measure is currently set to last until June 30, 2027.

Authorities, producers, and retail chains assess the initial results of the VAT reduction positively, noting both price decreases and increased demand. However, the effectiveness of this measure can only be fully evaluated after several months, when it becomes clear whether the achieved effect will be sustained in the long term.