Land in the System of Real Estate Objects and Features of Tax Application in Latvia

Abstract

Since the economic recession in Latvia, the national debt in September 2010, amounted to LVL 4.717 billion. The study confirms significant impact of downward trends of the economy of Latvia on the national budget performance indicators in 2009. One of the most commonly mentioned and controversial indicator is the real estate tax that has to be imposed also on the land. The aim of this study is to analyze and assess the system of the Land Fund of Latvia and features of tax application. To achieve the determined goal three key objectives – clarifying the concept of the land, types of property rights and ownership status and assessment and evaluation of allocation of national land-use according to targeted groups and the types of land use as well as gathering information on taxes imposed on land and assessing property tax revenue from the land to provide the development assessment of the land fund system in Latvia will be addressed in this research. As a result, recommendations for the improvement of the system of factors influencing the Land Fund of Latvia were developed. The key recommendation is to develop a new monitoring and control system for the complete inspection of real estate objects classifying them according to the regions as well as the creation of integrated database based on administrable taxes according to the categories of real estate. The results of the study can be applied for identification of the impact of fiscal policy to the assessment of the development trends of real estate tax in Latvia