RIGA - After a new system for calculating properties' cadastral values is passed, cadastral values of many real estate properties will increase, which is why the new rules' effect on property taxes will be thoroughly analyzed, the Justice Ministry's deputy state secretary Laila Medina told a press conference today.
Justice Minister Janis Bordans (New Conservative Party) said that the new methodology for calculation of cadastral values could only commence if ruling coalition parties agreed on reforming the system of property taxes. Namely, the state must have objective information about cadastral values, but they may not increase taxes on residents' primary residence disproportionately, said the minister.
The new cadastral bases will be known in mid-2020 and applied from 2021 onwards, said Medina. The Justice Ministry has presented a timetable for implementation of the new rules to the Finance Ministry, and discussions are already under way on incorporation of the new procedure in the tax policy developed by the Finance Ministry, she added
The State Land Service's Director General Solvita Zvidrina explained that the current system of cadastral values was approved back in 2014. The new system will be based on the latest market data, and neither the Land Service nor the Justice Ministry can predict what effect they will have on the real estate market.
The new system will significantly reduce the number of encumbrances on properties, said Zvidrina. The new system will automatically calculate properties' depreciation, and is also intended to greatly improve information exchange among various institutions, she added.
Zvidrina and Medina urged the public to get involved in discussions about the new system by expressing their opinions in writing and sending them to email@example.com until May 14.