European Commission Adopts Proposal for Council Decision on Latvia Input VAT Deductions on Car Expenditures

The European Commission (EC) Oct. 23 adopted Proposed Council Implementing Decision No. COM/2024/488, authorizing Latvia’s request to extend its application of a deviation from Articles 26(1)(a), 168, and 168a of the VAT Directive, to continue the 50 percent limitation on input VAT deduction rights for expenditures related to specified passenger cars not used exclusively for business purposes. Latvia is also authorized to relieve taxable persons from having to treat the private use of such vehicles as supplies of services for consideration. The proposed decision includes measures to: 1) extend Latvia’s authorization for the deviation until Dec. 31, 2027, from Dec. ...