ZSA, LOSP and Maxima are leading an initiative to collect signatures for reducing VAT on food

To ensure low prices for customers and growth for local producers, Maxima and partner organizations have started collecting signatures on the My Voice portal for the initiative “Let's reduce VAT on food products”. Its goal is to encourage changes in legislation by setting a reduced VAT rate of 51% for food products – fresh meat, fresh fish, eggs, dairy products, while also maintaining it for fruits and vegetables typical of Latvia.

“Every day, 300,000 people shop in our stores across Latvia, and of the TOP 10 most purchased products, approximately 70% of % are fresh food (meat, milk, fruits and vegetables), so reducing VAT would be an opportunity to reduce daily spending on food, thus also promoting the growth of local producers. Governments have effectively implemented this in several European Union countries, applying a lower VAT rate specifically to food products. This simultaneously fuels the economy, supports families and socially vulnerable residents, while allowing wealthier people to divert spending from food elsewhere. I am pleased that, together with the participation of such important partners as the “Farmers' Council” and the “Cooperation Council of Agricultural Organizations”, we can start moving such a project forward on a Latvian scale,” says Jānis Vanags, Corporate Manager of “Maxima Latvija”.

“The VAT reduction for fruits and vegetables typical of Latvia, which was introduced for a three-year period in 2018, has made a great contribution to both farmers and society as a whole. The shadow economy in this sector has also decreased. Although fluctuations in food demand are usually insignificant, this initiative has increased the consumption of fresh fruits and vegetables by as much as 14%. This shows that society responded to the price reduction and must be given the opportunity to take the next step towards a healthy and high-quality diet by reducing the VAT rate to 5% for fresh meat, fresh fish, eggs, and dairy products. We can gradually move towards this,” says Mārtiņš Trons, board member of the association “Farmers' Council”.

“The VAT reduction has a positive impact not only on the final price for buyers, but also on local farmers and producers. The reduced VAT on fruit and vegetables in Latvia has already shown that it is an effective way to reduce the shadow economy and thus promote the competitiveness of our farmers. In these exceptional circumstances, it would ensure the preservation of jobs and, consequently, the recovery of the economy. We call on you to maintain the reduced VAT on fruit and vegetables and not to postpone the implementation of this solution for other groups of fresh products, making every effort to achieve this goal,” emphasizes Guntis Gūtmanis, member of the board of the association “Cooperation Council of Agricultural Organizations”.

“Companies and industry associations from various sectors have a deep understanding of the problematic aspects and solutions in their field of activity, which benefit both the industry and society as a whole. It is true that decisions with a broad public benefit also require targeted progress. Therefore, it is commendable that in this case “Maxima Latvija” is taking it on, moreover, choosing the “Mana balss” platform as a way to conduct this lobbying openly, visibly for everyone and with the involvement of the widest possible society. In the opinion of “Mana balss”, this is a corporate and socially responsible decision. It is gratifying that there are more and more of them in Latvia,” points out Didzis Meļķis, content editor at ManaBalss.lv.

The initiative to reduce VAT on food products is being led by the retail chain "Maxima Latvija" in cooperation with leading agricultural organizations - the association "Cooperation Council of Agricultural Organizations" (LOSP) and the association "Farmers' Council" (ZSA), and it is expected that a large number of new organizations and civil society representatives will join the initiative, taking into account the relevance of the topic in a period of declining economy and declining purchasing power.