Latvia Tax Agency Issues Methodological Material on VAT Application for Transactions Between Main Companies, Branches

The Latvian State Revenue Service Dec. 16 issued methodological material on the application of VAT in transactions between main companies and their branches. Topics covered include: 1) that a branch is an organizationally independent part of a company, separated from the main company, where commercial activities are systematically carried out on behalf of the merchant; 2) that a transaction subject to VAT is considered to have taken place only if the service provider and the service recipient are involved in it; 3) that if a branch lacks equity, the economic risk lies with the parent company, resulting in them being ...