Nine organizations of foreign and domestic investors, business and industry associations, as well as professionals in Latvia and its diaspora, have jointly urged the Latvian government to amend laws and regulations in order to prevent economic double taxation on dividends for individual investors. At a time when Latvia lags further behind its neighbors in economic growth and development, it is imperative to remove all barriers reducing its international competitiveness. The joint call has been addressed to the Prime Minister, line ministers, and Saeima's Committees. Signatories include the American, British and Norwegian Chambers of Commerce in Latvia, FICIL, LETERA, Latvian Exporters Association The Red Jackets, American Latvian Association, the Latvian American Chamber of Commerce in the U.S. and the World Federation of Free Latvians.

According to representatives from these organizations, Latvia's corporate tax system underwent changes in 2018 that resulted in unfavorable tax treatment for individual investors living abroad or who may be liable for taxation in other jurisdictions. Consequently, investment profits are subject to taxation both in Latvia and in the country of the investor's residence, creating a negative impact on Latvia’s ability to attract new and maintain existing investments compared to other jurisdictions in our region.

Since 2020, the Foreign Investors Council in Latvia, AmCham, and other organizations have consistently called on Latvian government institutions to address this issue. They have recommended a fiscally neutral solution, which would allow taxpayers to elect to treat up to 10% of corporate income tax paid on dividends as a withholding tax or personal income tax, thereby applying for tax treaty benefits. However, action has yet to be taken to implement this recommendation or find an alternative solution.

Regarding the plea made to the Prime Minister, sectoral ministers, and responsible Saeima Committees, the authors of the statement emphasized that the proposed solution is fiscally neutral and would not have a negative impact on the state budget. The current regulations result in the state collecting a smaller share of the overall tax revenue due to different tax regimes. Higher taxes paid by investors in other jurisdictions do not contribute to the Latvian budget or enhance the country's competitiveness in attracting new individual and institutional investors.

“This situation negatively affects not only foreign investors who have invested in Latvian companies but also Latvian investors seeking to explore new markets and expand their businesses abroad. It also impacts Latvian re-emigrants who are willing to return to Latvia for business purposes while still maintaining tax obligations in other jurisdictions. For these reasons, we believe it is important to make every effort to attract new investors and enable local investors to expand their businesses in foreign markets without subjecting them to an increased tax burden," explains Zinta Jansons, Head of AmCham Tax Work Group.