The Saeima¹ has adopted and
the President has proclaimed the following law:

Natural Resources Tax Law

Chapter I
General Provisions

Section 1. Terms Used in This Law

The following terms are used in this Law:

1) manager - a merchant of the extended producer responsibility scheme which is a natural resources taxpayer or a commercial company which on the basis of an agreement entered into with the natural resources taxpayer organises and coordinates the operation of the relevant extended producer responsibility scheme;

2) [9 July 2020];

3) natural resources - part of nature, also soil, ground, subterranean depths, air, waters, biological diversity;

4) extraction of natural resources - separation of natural resources from natural environment thereof, also collection of edible park snails (Helix pomatia L.);

5) use of natural resources - utilisation of natural resources, and also utilisation of useful properties of subterranean depths by pumping natural gas into geological structures and emission of polluting substances into the environment;

6) limit - the maximum permissible quantity of extraction, use of natural resources or pollution emitted thereby (also landfill waste) specified in the permit or licence, expressed in the relevant units of measurement of quantity;

7) economic activity - sale of natural resources, manufacturing of goods, performance of works, provision of services and other activities carried out for remuneration;

8) goods harmful to the environment - goods for manufacturing or distribution for which restrictions have been specified or for waste management for which specific requirements are specified if they have or may have a negative impact on the environment, life or health of human beings during the cycle of circulation thereof;

9) bioplastics - biodegradable plastics (biopolymer) the ingredients of which fully or partly are obtained from renewable source material;

10) [26 April 2018 / See Paragraph 27 of Transitional Provisions];

11) plastic - a polymer within the meaning of Article 3(5) of Regulation (EC) No 1907/2006 of the European Parliament and of the Council of 18 December 2006, to which additives or other substances may have been added, and which is capable of functioning as a main structural component of packaging, including carrier bags, and disposable tableware and accessories;

12) [9 July 2020];

13) [9 July 2020];

14) producer of goods - a person who pays the natural resources tax for the packaging and disposable tableware and accessories, goods harmful to the environment, and vehicles in conformity with Section 3 of this Law;

15) extended producer responsibility scheme - an aggregate of measures upon implementation of which a producer of goods bears financial or financial and organisational responsibility for efficient management of the waste of its goods and packaging placed on the market.

[8 November 2007; 14 November 2008; 12 June 2009; 20 December 2010; 32 November 2016; 15 December 2016; 26 April 2018; 9 July 2020]

Section 2. Purpose of the Natural Resources Tax

The purpose of the natural resources tax (hereinafter - the tax) is to promote economically efficient use of natural resources, to restrict pollution of the environment, to reduce manufacturing and sale of environment polluting substances, to promote implementation of new, environment-friendly technology, to support sustainable development in the economy, and also to ensure environmental protection measures financially.

Section 3. Taxpayers

(1) A taxpayer shall be a person who:

1) has received or who, in accordance with the laws and regulations regarding environmental protection or use of subterranean depths, had an obligation to obtain a permit, a licence specified in the laws and regulations regarding environmental protection or register a Category C polluting activity, and who performs the following in the territory of the Republic of Latvia, continental shelf, or exclusive economic zone:

a) extracts taxable natural resources;

b) sells taxable natural resources extracted in such economic activity which is not related to the extraction of mineral resources from subterranean depths;

c) uses useful properties of the subterranean depths by pumping natural gas into geological structures;

d) emits taxable polluting substances into the environment, buries waste at a waste landfill site, incinerates waste in an incineration or co-incineration plant;

e) [15 December 2016];

f) uses water resources for production of electricity in a hydroelectric power plant;

1¹) [15 December 2016];

2) who first in the territory of the Republic of Latvia:

a) sells goods harmful to the environment or goods in packaging (also together with imported goods, the primary, secondary and tertiary packaging attached thereto) or coal, coke, and lignite (brown coal), fireworks, and also attaches packaging to an aggregate of goods or products (purchase) in packaging or without it because of customer's convenience or advertising design;

b) for ensuring his or her economic activities uses goods harmful to the environment, except for goods taxable upon selling thereof or goods purchased in packaging (also together with imported goods, the primary, secondary and tertiary packaging attached thereto), except for goods in packaging taxable upon selling thereof;

c) upon provision of a service, attaches packaging to the product, and this packaging gets to the recipient of the service after provision of the service;

d) for ensuring his or her economic activities thereof uses coal, coke, and lignite (brown coal), except for coal, coke, and lignite (brown coal) which are taxable when sold, and fireworks;

3) in the territory of the Republic of Latvia in public catering and retail trade sells disposable tableware and accessories which are manufactured from plastic (polymers), paper, cardboard, composite materials thereof (laminates) with polymer or metal components, metal foil, wood, or other natural fibres (hereinafter - the disposable tableware and accessories);

4) utilises in its activities radioactive substances after utilisation of which radioactive waste is created and which it is necessary to store or to dispose of in the territory of the Republic of Latvia;

5) registers vehicles permanently for the first time in Latvia for which Section 3, Paragraph one of the Management of End-of-Life Vehicles Law applies;

6) wishes to remove a vehicle from the register for writing-off in the State Register of Vehicles and Their Drivers of valsts akciju sabiedrība "Ceļu satiksmes drošības direkcija" [State joint stock company Road Traffic Safety Directorate] for which it is not possible to receive a certificate of destruction of an end-of life vehicle due to non-existence of the vehicle if the certificate of destruction of an end-of life vehicle should be issued.

(1¹) A taxpayer is a manager who has entered into an agreement with an institution under subordination of the Ministry of Environmental Protection and Regional Development on the application of the extended producer responsibility scheme in relation to waste management of end-of-life vehicles, used packaging, or the disposable tableware and accessories or of goods harmful to the environment, however, has not fulfilled the requirements of Section 7, 8, or 9 of this Law and the liabilities included in the management agreement in relation to the amounts of recycling and recovery laid down in the laws and regulations for specific types of waste.

(1²) A taxpayer is an operator of a deposit-refund scheme which has entered into an agreement with an institution under subordination of the Ministry of Environmental Protection and Regional Development on ensuring of the operation of the deposit-refund scheme, however, has not fulfilled the liabilities included in the agreement in relation to the amounts of take-back, reuse, and recovery of deposit packaging laid down in the laws and regulations.

(2) A person who performs a transaction for the supply of goods harmful to the environment or for goods in packaging in a customs warehouse or free zone shall pay the tax if he or she puts goods harmful to the environment or goods in packaging into free circulation and sells them in the territory of the Republic of Latvia.

(3) If a person who manufactures goods passes them over to another person for packaging, the taxpayer shall be the person who first sells these packaged goods in the territory of the Republic of Latvia.

(4) If a person who manufactures and sells goods in the territory of the Republic of Latvia or imports goods in packaging from other countries, uses reusable packaging that is leased from another person, the taxpayer shall be the person who leases such packaging for packaging of goods.

[19 December 2006; 8 May 2008; 12 June 2009; 20 December 2010; 6 November 2013; 23 November 2016; 15 December 2016; 26 April 2018; 3 April 2019; 14 November 2019; 30 April 2020; 9 July 2020; 23 November 2020 / Amendments to Sub-clause "d" of Paragraph one shall come into force on 1 January 2021. See Paragraph 34 of Transitional Provisions]

Section 4. Taxable Objects and Tax Rates

(1) The following shall be taxable:

1) natural resources in accordance with Annexes 1 and 2 to this Law, and also the collection of edible park snails (Helix pomatia L.) for further economic use;

2) use of the useful properties of subterranean depths by pumping natural gas into geological structures;

3) waste disposal at a waste landfill site, incineration of waste in an incineration or co-incineration plant, and emission of polluting substances into the environment in conformity with Section 14.¹ of and Annexes 3, 4, and 5 to this Law;

4) [15 December 2016];

5) goods harmful to the environment in accordance with Annex 6 to this Law;

6) packaging of goods and products (hereinafter also - the packaging) and the disposable tableware and accessories in accordance with Section 24 of and Annex 7 to this Law. Also such packaging shall be taxable, which is added by the service provider to products and which remains with the service recipient after the service is provided;

7) radioactive substances in accordance with Annex 8 to this Law;

8) vehicles to which Section 3, Paragraph one of the Management of End-of-Life Vehicles Law is applicable;

9) coal, coke, and lignite (brown coal) in accordance with Annex 9 to this Law;

10) fireworks of Category F1, F2, F3, and F4.

(2) The tax rates for the use of useful properties of subterranean depths, by pumping natural gas into geological structures; for Category C polluting activities in fields regarding which no conditions are laid down in laws and regulations and for which it is also not possible to calculate the volume of polluting substances; for the collection of edible snails (Helix pomatia L.) for further economic use; for packaging in cases where it is not possible to justify the type of material and weight thereof with accounting documents; for vehicles and for fireworks shall be laid down in Sections 14, 15, 20, 24, 24.¹, and 26 of this Law accordingly. In other cases tax rates, and also their terms of validity shall be specified in Annexes to this Law.

(3) The Cabinet, according to the division of tax rates specified in Annexes to this Law, shall determine:

1) the classification of natural resources, polluting substances, waste and radioactive substances and their conformity with the tax rate groups;

2) the classification of goods harmful to the environment, technical specifications and their conformity with the tax rate groups.

(4) The Cabinet shall determine when the packaging of goods and articles is non-taxable.

(5) To plastic carrier bags ensured by a merchant because of customer's convenience or advertising design at the sales points of goods or production, regardless of whether a separate payment is collected for these bags, the tax rate specified in Section 24 of this Law shall be applied. The tax rate laid down in Annex 7 to this Law shall be applied to the plastic bags referred to in this Paragraph which have been manufactured from bioplastics. If the goods are sold in plastic bags in which a merchant has prepacked them and packed before placement on the sales point, the tax rate specified in Annex 7 to this Law shall be applied to these bags.

(6) [20 December 2010]

[19 December 2006; 8 November 2007; 8 May 2008; 14 November 2008; 12 June 2009; 20 December 2010; 6 November 2013; 23 November 2016; 15 December 2016; 26 April 2018; 14 November 2019 / Amendment to Clause 3 of Paragraph one shall come into force on 1 January 2021. See Paragraph 34 of Transitional Provisions]

Chapter II
Exemptions from Payment of the Tax and Application of the Extended Producer Responsibility Scheme

[9 July 2020]

Section 5. Exemption from Payment of the Tax for the Use of Natural Resources

The tax shall not be paid for:

1) the background pollution, if the taxpayer has proven the relevant pollution level by monitoring data performed in accordance with the requirements laid down in the laws and regulations;

2) the use of water (flow) in fishery facilities, fish farms, and pond farms;

3) the use of thermal and technical water which has been pumped back into the water intake level after utilisation, without changing the chemical composition of the water (except for desalination);

4) the placement of ballast sand in locations stipulated by the local government of that area;

5) the introduction of pollutants into the filtration layer of the soil or the ground (absorbent) if it is provided for as a pollution treatment method in the treatment installation project;

6) the volume of pollutant that due to accidental leakage has entered the environment in an unlawful manner which the guilty person has collected or neutralised in accordance with the time period and requirements stipulated by the State Environmental Service;

7) the reduction of the level of groundwater in the process of pumping out water if the pumping out thereof is associated with the extraction of mineral resources;

8) the water utilised for manufacturing needs if it is reused after treatment.

[6 November 2013; 23 November 2016]

Section 6. Exemption from Payment of the Tax for the Utilisation of Radioactive Substances

(1) The tax for the utilisation of radioactive substances, for the performance of their functions, shall not be paid by State institutions which ensure:

1) radiation safety and nuclear safety supervision and control;

2) metrology;

3) contingency plans in the event of radiation accidents;

4) radiometric control on the State borders;

5) the performance of criminal procedural activities.

(2) The tax for the utilisation of radioactive substances shall not be paid for by medical treatment institutions, where radioactive substances are necessary for the medical treatment and diagnosis of oncological, cardiological diseases and heart diseases amenable to surgery, ensuring health care of mothers and children, renal transplantation and ensuring HIV infected patient care according to the State programmes, and also if radioactive substances are used in the medical treatment and diagnosing of other diseases.

(3) The tax for the utilisation of radioactive substances shall not be paid by radioactive waste disposal and management undertakings.

(4) A person who utilises radioactive substances shall not pay the tax if the purchase contract includes guarantees that the used ionising radiation source shall be sent back to the State of manufacture.

(5) A person who utilises radioactive substances shall not pay the tax if these radioactive substances are used for demonstration in exhibitions, fairs, or similar events and they are brought into Latvia for a time period not exceeding 30 days.

Section 6.¹ Application of the Extended Producer Responsibility Scheme

(1) In conformity with this Section and Sections 7, 8, 9 and Chapter II.¹ of this Law regardless of the marketing method used, and also regardless of the distance contract entered into, the extended producer responsibility scheme shall be applied to:

1) vehicles to which Section 3, Paragraph one of the Management of End-of-Life Vehicles Law is applicable;

2) packaging, except for deposit packaging, and disposable tableware and accessories, except for the disposable tableware and accessories made of plastic (polymers) and their composite materials (laminates);

3) goods harmful to the environment.

(2) The extended producer responsibility scheme shall be applied to deposit packaging in conformity with Section 8.¹ of this Law, the Packaging Law, and the laws and regulations regarding the operation of the deposit-refund scheme.

(3) The State and local government authorities shall have the following competence in application of the extended producer responsibility scheme:

1) the Ministry of Environmental Protection and Regional Development shall include the tasks and measures for the improvement of the extended producer responsibility scheme in the State waste management plan;

2) the institution under subordination of the Ministry of Environmental Protection and Regional Development shall publish information on the application of the extended producer responsibility scheme, a list of managers, and information on the waste management of the relevant type of managers, including on the amounts of recycling and recovery of waste on its website;

3) the local government, when organising and planning separate collection of waste in its administrative territory in conformity with the laws and regulations regarding waste management, shall cooperate with the managers.

(4) The manager has the following obligations:

1) to ensure efficient management of the waste from the goods and packaging placed on the market in the territory of the Republic of Latvia by itself or contracting partners, including separate collection, sorting, recycling, and recovery of waste of the relevant type in order to achieve the objectives laid down in the laws and regulations regarding packaging and waste management;

2) to ensure that the payments of its contracting partner covering the costs referred to in Paragraph six of this Section are as differentiated as possible in relation to particular goods or groups of similar goods and packaging of goods in conformity with the priority order of the types of waste management laid down in the Waste Management Law and implementing even functioning of the internal market to the extent possible;

3) to conform to the principle of transparency in its operation and decision-making, including to justify the costs related to the implementation of the extended producer responsibility scheme;

4) to ensure an annual independent audit of the extended producer responsibility scheme within the scope of which the following shall be evaluated:

a) the financial management of the system in conformity with the requirements of Paragraph six of this Section;

b) the quality of data submitted to the institution under subordination of the Ministry of Environmental Protection and Regional Development;

5) to inform the waste producer and possessor of the waste prevention measures, the possibilities of re-using goods and packaging, the places of separate collection of waste from goods and used packaging, and the places where the waste and used packaging is prepared for re-use, of prevention of pollution, and also to organise the measures promoting the involvement of waste producers and possessors in the separate waste collection system;

6) to publish information on its website on:

a) founders, members, shareholders, or stockholders;

b) the number of such taxpayers which have entered into an agreement on the participation in the extended producer responsibility scheme;

c) the fee of contracting partners for the participation in the extended producer responsibility scheme by indicating the fee in euro for the unit of measurement of goods and packaging placed on the market;

d) the procedure for the selection of such merchants with which agreements on the preparation of waste of the relevant type for re-use, recovery, or recycling have been entered into;

7) to ensure that the extended producer responsibility scheme is open to all producers of goods and the conditions for its application are equal, non-discriminating, and do not place a disproportionate regulatory burden, including on small and medium-sized enterprises.

(5) The manager shall inform the public in conformity with Paragraph three, Clause 2 and Paragraph four, Clause 6 of this Section, except for the cases when the relevant information is a trade secret in conformity with the Trade Secret Protection Law.

(6) In order to ensure the operation of the extended producer responsibility scheme, a producer of goods shall cover the following costs for the goods and packaging placed on the market in the territory of the Republic of Latvia:

1) the costs for the management of waste of the relevant type, including separate collection, sorting, recycling, and recovery of such waste in order to achieve the objectives laid down in the laws and regulations regarding packaging and waste management deducting such part of the revenues which is directly or indirectly earned thereby from re-use and from trade in the separated household waste that can be recovered;

2) the costs for the provision of information to the waste producer and possessor in accordance with Paragraph four, Clause 5 of this Section;

3) the costs for the preparation of the report referred to in Section 7, Paragraph two, Clauses 2 and 5, Section 8, Paragraph two, Clauses 4 and 5, or Section 9, Paragraph two, Clauses 4 and 5 of this Law and the submission thereof to the institution under subordination of the Ministry of Environmental Protection and Regional Development.

(7) If a person of a third country places goods on the market in the territory of the Republic of Latvia, it may participate in the extended producer responsibility scheme provided that it is registered with the State Revenue Service as a taxpayer or has authorised in writing a person performing commercial activities in the Republic of Latvia to take over the liabilities of the relevant producer of goods of a third country in the territory of the Republic of Latvia in relation to the fulfilment of the obligations of the participant of the extended producer responsibility scheme laid down in this Section. The person of the third country shall inform the manager of the abovementioned authorised person.

[9 July 2020 / See Paragraph 38 of Transitional Provisions]

Section 7. Exemption from Payment of the Tax for Vehicles which are Registered Permanently for the First Time in the Republic of Latvia

(1) The tax for vehicles shall not be paid by the manufacturer of the vehicle or the authorised representative thereof, or the seller of used vehicles, if he or she ensures the conformity with the requirements laid down in the laws and regulations regarding the management of end-of-life vehicles, and also conforms to one of the following requirements:

1) has established and applies the extended producer responsibility scheme in relation to the management of end-of-life vehicles (hereinafter - the end-of-life vehicle management system), has submitted a financial security for covering of the tax payment (hereinafter - the financial security) to the institution under subordination of the Ministry of Environmental Protection and Regional Development, and has entered into an agreement with such institution on the application of the end-of-life vehicle management system (hereinafter - the end-of-life vehicle management agreement);

2) has entered into an agreement with the manager for the participation in the end-of-life vehicle management system (if the manager has submitted the financial security to the institution under subordination of the Ministry of Environmental Protection and Regional Development and has entered into an agreement on the management of end-of-life vehicles with such institution).

(2) The Cabinet shall determine:

1) the procedures for the manufacturer of vehicles or authorised representative thereof, seller of used vehicles who permanently registers a used vehicle for the first time in Latvia, to submit documents to the institution under subordination of the Ministry of Environmental Protection and Regional Development and specified in the laws and regulations confirming the establishment and application of the end-of-life vehicle management system or participation in the operation of such system;

2) the procedures for the manufacturer of vehicles or authorised representative thereof, or the seller of used vehicles who permanently registers a used vehicle for the first time in Latvia, to submit a report on the collection and recycling of end-of-life vehicles (if it does not pay tax for vehicles) and report form and information to be included therein;

3) the essential provisions of the end-of-life vehicle management agreement;

4) the requirements for the establishment and application of the end-of-life vehicle management system, and also for the manager whose contract partners do not pay tax for vehicles;

5) the procedures for the taxpayer who has established and applies the end-of-life vehicle management system itself and does not pay tax and the manager whose contracting partners do not pay tax for vehicles to submit an audited report on collection and recycling of the end-of-life vehicles, report form and information to be included therein.

(3) The institution under subordination of the Ministry of Environmental Protection and Regional Development shall control the fulfilment of the operational programme of end-of-life vehicle management system, and also inform the State Revenue Service and the State joint stock company Road Traffic Safety Directorate in writing by the 20th date of the next month following the quarter after it has taken a decision on exemption from the tax, and provide the necessary information thereto.

(3¹) If the management agreement with the institution under subordination of the Ministry of Environmental Protection and Regional Development and specified in laws and regulations is entered into by the manager, he or she shall inform his or her contract partners of the agreement entered into and the applicable exemption from payment of the tax.

(4) A taxpayer or manager shall forfeit the right to exemption from tax specified in this Section, if the agreement referred to in Paragraph one of this Section has been terminated in accordance with the procedures laid down in laws and regulations because a taxpayer or manager fails to apply the end-of-life vehicle management system or applies it partly and does not fulfil the liabilities included in the agreement with the institution under subordination of the Ministry of the Environmental Protection and Regional Development. Application of exemption from the payment of tax shall be terminated starting from the first day of the first month of the next quarter following the day of agreement termination.

(5) A taxpayer or manager shall forfeit the right to exemption from tax specified in this Section, if the agreement referred to in Paragraph one of this Section has been terminated in accordance with the procedures laid down in laws and regulations because a taxpayer or manager has failed to submit a report referred to in Paragraph two, Clause 2 of this Section to the institution under subordination of the Ministry of Environmental Protection and Regional Development within a month after the period of time specified in the laws and regulations governing the environmental protection. Application of exemption from the payment of tax shall be terminated starting from the first day of the first month of the next quarter following the day of agreement termination.

(6) Challenge and appeal of the decision referred to in Paragraphs four and five of this Section on unilateral withdrawal from an agreement in cases when a taxpayer or manager fails to apply the end-of-life vehicle management system or applies it partly and does not fulfil the liabilities included in the agreement with the institution under subordination of the Ministry of Environmental Protection and Regional Development and in cases when a taxpayer or manager fails to submit the report referred to in Paragraph two, Clause 2 of this Section to the institution under subordination of the Ministry of Environmental Protection and Regional Development within a month after the period of time specified in the laws and regulations governing the environmental protection shall not suspend the operation of the decision.

(7) The procedures by which the agreement referred to in Paragraph one of this Section shall be entered into and terminated, including the procedures by which unilateral withdrawal shall take place in cases when a taxpayer or manager fails to apply the end-of-life vehicle management system or applies it partly and does not fulfil the liabilities included in the agreement with the institution under subordination of the Ministry of Environmental Protection and Regional Development and in cases when a taxpayer or manager fails to submit the report referred to in Paragraph two, Clause 2 of this Section to the institution under subordination of the Ministry of Environmental Protection and Regional Development within a month after the period of time specified in the laws and regulations governing the environmental protection shall be determined by the Cabinet.

(8) Upon terminating the management agreement specified in this Section, the taxpayer or manager who was exempted from payment of the tax shall, within three months after the day when the agreement was terminated, submit to the institution under subordination of the Ministry of Environmental Protection and Regional Development with which the management agreement had been entered into, a report on the collection of end-of-life vehicles and processing for a period of time from the beginning of the calendar year until the time when exemption form payment of the tax was terminated.

(9) A person who permanently registers a vehicle for the first time in Latvia shall not pay the tax for a vehicle, if he or she has purchased a certification note from the manager who has established and applies the end-of-life vehicle management system and has entered into an end-of-life vehicle management agreement with the institution under subordination of the Ministry of Environmental Protection and Regional Development and specified in laws and regulations. A certification note justifies a payment made by the person to the manager that the manager will accept the relevant vehicle when it will be end-of-life and will perform the appropriate management thereof.

(10) The Cabinet shall determine:

1) the requirements for a manager who sells a certification note, a sample form of the certification note and information to be included therein, and also the procedures by which the information on the sold certification notes shall be provided for in the State Register of Vehicles and Drivers;

2) the procedures by which a manager who sells certification notes shall submit a report on the sold certification notes to the institution under subordination of the Ministry of Environmental Protection and Regional Development and specified in laws and regulations, a sample form of the report and the information to be included therein.

[8 May 2008; 14 November 2008; 12 June 2009; 20 December 2010; 23 November 2016; 15 December 2016; 26 April 2018; 9 July 2020]

Section 8. Exemption from Payment of the Tax for Packaging and the Disposable Tableware and Accessories

(1) A taxpayer shall not pay the tax for packaging or the disposable tableware and accessories if he or she ensures the fulfilment of the norms for used packaging and the disposable tableware and accessories recovery specified in the laws and regulations regarding environmental protection, and also conforms to one of the following conditions:

1) has established and applies the extended producer responsibility scheme in relation to the management of the used packaging or disposable tableware and accessories (hereinafter - the used packaging or disposable tableware and accessories management system), has submitted the financial security to the institution under subordination of the Ministry of Environmental Protection and Regional Development, and has entered into an agreement with such institution on the application of the used packaging or disposable tableware and accessories management system (hereinafter - the agreement on the management of the used packaging or disposable tableware and accessories);

2) has entered into an agreement with the packaging or disposable tableware and accessories manager on participation in the used packaging or disposable tableware and accessories management system (if the manager is registered in the State Environmental Service, has submitted the financial security to the institution under subordination of the Ministry of Environmental Protection and Regional Development, and has entered into an agreement with such institution on the management of the used packaging or disposable tableware and accessories).

(1¹) Exemption from payment of the tax shall not be applied to the disposable tableware and accessories made out of plastic (polymers) and their composite materials (laminates).

(1²) A taxpayer for which the amount of packaging waste generated in a calendar year is 300 kilograms or more shall participate in the extended producer responsibility scheme by entering into a contract with a manager for participation in the packaging waste management scheme or create and apply such scheme itself.

(1³) A taxpayer who fails to fulfil the obligation referred to in Paragraph 1.² of this Section shall pay the tax in double amount.

(2) The Cabinet shall determine:

1) the procedures for the packaging or disposable tableware and accessories manager to submit to the institution under subordination of the Ministry of Environmental Protection and Regional Development and specified in laws and regulations documents which confirm the application of the used packaging or disposable tableware and accessories management system and participation of the contracting partners of the manager in the operation of such system;

2) the procedures for the taxpayer to submit documents to the institution under subordination of the Ministry of Environmental Protection and Regional Development and specified in laws and regulations which confirm the application of the used packaging or disposable tableware and accessories management system established by the taxpayer;

3) the requirements for the establishment and application of the used packaging or disposable tableware and accessories management system, and also the requirements for the taxpayer who has personally established and applies the used packaging or disposable tableware and accessories management system and does not pay tax, and the requirements for the packaging or disposable tableware and accessories managers whose contracting partners do not pay tax for packaging or disposable tableware and accessories;

4) the procedures for the taxpayer who has personally established and applies the used packaging or disposable tableware and accessories management system and does not pay tax and the packaging or disposable tableware and accessories manager whose contracting partners do not pay tax for packaging or disposable tableware and accessories to submit an audited report on the management of the used packaging or the management of disposable tableware and accessories, the calculated tax, report form and information to be included therein;

5) the procedures by which the taxpayer who has personally established and applies the used packaging or disposable tableware and accessories management system and does not pay tax and the packaging or disposable tableware and accessories manager whose contracting partners do not pay tax for packaging or disposable tableware and accessories shall submit a report on the management of the used packaging or the management of disposable tableware and accessories, the calculated tax, report form and information to be included therein;

6) the documents with which it is certified that packaging which has been in contact with hazardous chemical substances or hazardous chemical products, after the use of the packaged substances, has been purified to such a level that it no longer is deemed to be hazardous waste, and the procedures for the issue of such documents;

7) the essential provisions of the agreement regarding management of the used packaging or disposable tableware and accessories;

8) the procedures for the determination of the amount of recycling and recovery of used packaging and disposable tableware and accessories within the framework of the used packaging or disposable tableware and accessories management systems;

9) the procedures for the institution under subordination of the Ministry of Environmental Protection and Regional Development to take a decision on the application of exemption from the payment of tax for packaging and disposable tableware and accessories;

10) the procedures for the institution under subordination of the Ministry of Environmental Protection and Regional Development to examine a report and an audited report on the management of the used packaging or disposable tableware and accessories, and calculated tax;

11) the procedures by which the agreement referred to in Paragraph one of this Section shall be entered into, amended, and terminated and the conditions for amending the agreement;

12) the procedures for the unilateral withdrawal from the agreement referred to in Paragraph one of this Section in cases when:

a) the taxpayer who has personally established and applies the used packaging or disposable tableware and accessories management system or the manager fails to apply the management system or applies it partly and does not fulfil the liabilities included in the agreement with the institution under subordination of the Ministry of Environmental Protection and Regional Development on the management of the packaging or disposable tableware and accessories;

b) the taxpayer who has personally established and applies the used packaging or disposable tableware and accessories management system or the manager has failed, within a month after the period of time laid down in laws and regulations, to submit the report referred to Clauses 4 and 5 of this Paragraph or the financial security referred to in Paragraph one, Clauses 1 and 2 of this Section to the institution under subordination of the Ministry of Environmental Protection and Regional Development.

(3) The institution under subordination of the Ministry of Environmental Protection and Regional Development shall control the fulfilment of the operational programme for the packaging or disposable tableware and accessories management system, and also inform the State Revenue Service in writing by the 20th date of the next month following the quarter after it has taken a decision on exemption from tax, and provide the necessary information thereto.

(4) A taxpayer who sells disposable tableware and accessories and is the first who sells the goods in packaging or the first to use the goods purchased in packaging for ensuring economic activities thereof in order to receive exemption from the tax shall ensure both the management of the used packaging and the establishment and application of the management system for the disposable tableware and accessories made out of paper, cardboard, metal foil, wood, or other natural fibres.

(5) The same recycling and recovery norms (by years) shall be applied to disposable tableware and accessories as for packaging in accordance with the laws and regulations regarding packaging management. Used packaging and disposable tableware and accessories may be managed by applying a unified management system.

(6) If the management agreement with the institution under subordination of the Ministry of Environmental Protection and Regional Development and specified in laws and regulations has been entered into by the manager, he or she shall inform in writing his or her contract partners of the agreement entered into and the exemption from payment of tax to be applied, indicating the date and number of the decision by the State Environmental Service which has been taken on the entering into of a management agreement and the application of exemption, and also indicating to which used packaging and disposable tableware and accessories types of material the exemption shall be applied and for what time period the exemption has been granted.

(7) Exemption from payment of the tax for the packaging which has been in contact with hazardous chemical substances or hazardous mixtures shall be applied in the following cases:

1) if the packaging after the use of the packaged substances has been purified to such a level that it no longer is deemed to be hazardous waste, and this may be documentarily proven, and the packaging is managed in accordance with the requirements of this Section;

2) if the packaging after the use of the packaged substances it is not possible to purify to such a level that it no longer is deemed to be hazardous waste, such packaging is managed in accordance with the requirements of the laws and regulations regarding management of hazardous waste and this may be documentarily proven.

(8) A taxpayer shall forfeit the right to exemption from tax specified in this Section, if the agreement referred to in Paragraph one, Clause 1 or 2 of this Section has been terminated in accordance with the procedures laid down in laws and regulations because a taxpayer or manager fails to apply the management system or applies it partly and does not fulfil the liabilities included in the agreement with the institution under subordination of the Ministry of Environmental Protection and Regional Development. Application of exemption from the payment of tax shall be terminated starting from the first day of the first month of the next quarter following the day of agreement termination.

(9) A taxpayer shall forfeit the right to exemption from the tax specified in this Section, if the agreement referred to in Paragraph one, Clause 1 or 2 of this Section has been terminated in accordance with the procedures laid down in laws and regulations because a taxpayer or manager fails to submit the report referred to in Paragraph two, Clauses 4 and 5 of this Section to the institution under subordination of the Ministry of Environmental Protection and Regional Development within a month after the period of time specified in laws and regulations. Application of exemption from the payment of tax shall be terminated starting from the first day of the first month of the next quarter following the day of agreement termination.

(10) Challenge and appeal of the decision referred to in Paragraphs eight and nine of this Section on unilateral withdrawal from the agreement in cases when a taxpayer or manager fails to apply the management system or applies it partly and does not fulfil the commitments included in the agreement with the institution under subordination of the Ministry of Environmental Protection and Regional Development and in cases when a taxpayer or manager has failed to submit the report referred to in Paragraph two, Clauses 4 and 5 of this Section to the institution under subordination of the Ministry of Environmental Protection and Regional Development within a month after the period of time specified in laws and regulations shall not suspend the operation of the decision.

(11) [26 April 2018]

(12) [9 July 2020]

(13) Upon termination of the management agreement laid down in this Section, within four months after the day when the agreement was terminated:

1) a taxpayer who has established and applied the used packaging or disposable tableware and accessories management system and has been exempted from payment of the tax shall submit a report on the management of the used packaging or the management of disposable tableware and accessories and the tax calculated for the time period from the beginning of the calendar year until the time when exemption from payment of the tax was discontinued, to the institution under subordination of the Ministry of Environmental Protection and Regional Development with which the agreement regarding management has been entered into;

2) a manager the contract partners of which do not pay the tax for packaging or disposable tableware and accessories shall submit an audited report on the management of the used packaging or the management of disposable tableware and accessories and the tax calculated for the time period from the beginning of the calendar year until the time when exemption from payment of the tax was discontinued, to the institution under subordination of the Ministry of Environmental Protection and Regional Development with which the agreement regarding management has been entered into.

[19 December 2006; 8 May 2008; 14 November 2008; 12 June 2009; 20 December 2010; 23 November 2016; 15 December 2016; 26 April 2018; 3 April 2019; 9 July 2020 / Paragraphs 1.² and 1.³ shall come into force on 1 January 2022. See Paragraph 39 of Transitional Provisions]

Section 8.¹ Exemption from Payment of the Tax for Deposit Packaging

(1) A taxpayer who is selling the beverages laid down in the laws and regulations regarding the management of packaging in a deposit packaging shall not pay the tax for such packaging if it has entered in an agreement with the operator of the deposit-refund scheme on participation in the deposit-refund scheme (if the operator of the deposit-refund scheme has entered into an agreement with the institution under subordination of the Ministry of Environmental Protection and Regional Development on ensuring of the operation of the deposit-refund scheme).

(2) The institution under subordination of the Ministry of Environmental Protection and Regional Development shall, by 20th date of the month following the quarter, inform the State Revenue Service of the agreement entered into on ensuring of the operation of the deposit-refund scheme with the operator of the deposit-refund scheme and of taxpayers to whom exemption from payment of the tax for deposit packaging has been applied.

(3) The institution under subordination of the Ministry of Environmental Protection and Regional Development shall, once a quarter, provide current information to the State Revenue Service on taxpayers to whom exemption from payment of the tax for deposit packaging has been applied.

(4) A taxpayer who is selling the beverages laid down in the laws and regulations regarding management of packaging in deposit packaging and who has an obligation to participate in the deposit-refund scheme, however, has not entered into an agreement with the operator of the deposit-refund scheme on participation in the deposit-refund scheme and does not participate in the deposit-refund scheme shall pay the tax for deposit packaging in double amount.

(5) Exemption from payment of the tax for deposit packaging in conformity with Section 8 of this Law shall not be applied to the taxpayer referred to in Paragraph four of this Section.

(6) The taxpayer referred to in Paragraph one of this Section shall lose the right to the exemption laid down in this Section if the agreement referred to in Paragraph one of this Section on participation in the deposit-refund scheme is terminated in accordance with the procedures laid down in laws and regulations.

(7) For a taxpayer who is selling the beverages laid down in the laws and regulations regarding application of the deposit-refund scheme in deposit packaging, the exemption from payment of the tax shall enter into effect from the first date of the first month of the following quarter after entering into the agreement with the operator of the deposit-refund scheme on participation in the deposit-refund scheme.

(8) The operator of the deposit-refund scheme which has entered into an agreement with an institution under subordination of the Ministry of Environmental Protection and Regional Development on ensuring of the operation of the deposit-refund scheme shall submit a report to the institution under subordination of such Ministry in accordance with the procedures laid down in the laws and regulations on the application of the deposit-refund scheme.

[30 April 2020 / Exemption from payment of the tax for deposit packaging shall be applied from 1 February 2022. See Paragraphs 35 and 37 of Transitional Provisions]

Section 9. Exemption from Payment of the Tax for Goods Harmful to the Environment

(1) A taxpayer shall not pay the tax for goods harmful to the environment if he or she ensures the fulfilment of norms for the recovery of the waste of goods harmful to the environment laid down in the laws and regulations regarding environmental protection, and also complies with one of the following conditions:

1) has established and applies the extended producer responsibility scheme in relation to the waste management for goods harmful to the environment (hereinafter - the waste management system for goods harmful to the environment), has submitted the financial security to an institution under subordination of the Ministry of Environmental Protection and Regional Development and has entered into an agreement with such institution on application of the waste management system for goods harmful to the environment (hereinafter - the agreement on the waste management for goods harmful to the environment);

2) has entered into an agreement with the manager of goods harmful to the environment regarding participation in the waste management system for goods harmful to the environment (if the manager has submitted the financial security to the institution under subordination of the Ministry of Environmental Protection and Regional Development and has entered in the agreement regarding management of goods harmful to the environment with such institution).

(2) The Cabinet shall determine:

1) the procedures for the waste manager for the waste of goods harmful to the environment to submit to the institution under subordination of the Ministry of Environmental Protection and Regional Development and specified in laws and regulations confirming application of a waste management system for the waste of goods harmful to the environment and participation of contracting parties of the manager in operation of such system;

2) the procedures for the taxpayer to submit to the institution under subordination of the Ministry of Environmental Protection and Regional Development and specified in laws and regulations documents confirming application of the waste management system for the waste of goods harmful to the environment established by taxpayer;

3) the requirements for the establishment and application of waste management systems for the waste of goods harmful to the environment, and also the requirements for the taxpayer who has personally established and applies the waste management system of goods harmful to the environment and does not pay the tax, and the requirements for waste managers for the waste of goods harmful to the environment whose contracting partners do not pay the tax for goods harmful to the environment;

4) the procedures by which the taxpayer who has personally established and applies the waste management system for goods harmful to the environment and does not pay the tax, and the waste manager for goods harmful to the environment whose contracting partners do not pay the tax for goods harmful to the environment shall submit an audited report on the waste management for goods harmful to the environment, the calculated tax, the report form and information to be included therein;

5) the procedures by which the taxpayer who has personally established and applies the waste management system for goods harmful to the environment and does not pay the tax, and the waste manager for goods harmful to the environment whose contracting partners do not pay the tax for goods harmful to the environment shall submit a report on the waste management for goods harmful to the environment, the calculated tax, the report form and information to be included therein;

6) the procedures for the determination of the amount of collection, recycling, and recovery of the waste of goods harmful to the environment within the framework of waste management systems of goods harmful to the environment;

7) the essential provisions of the agreement regarding management of the waste of goods harmful to the environment;

8) the procedures by which the institution under subordination of the Ministry of Environmental Protection and Regional Development shall take a decision on exemption from payment of the tax for goods harmful to the environment;

9) the procedures by which the institution under subordination of the Ministry of Environmental Protection and Regional Development shall examine a report and an audited report on the management of the waste of goods harmful to the environment and calculated tax;

10) the procedures by which the agreement referred to in Paragraph one of this Section shall be entered into, amended, and terminated and the conditions for amending the agreement;

11) the procedures for the unilateral withdrawal from the agreement referred to in Paragraph one of this Section in cases when:

a) the taxpayer who has personally established and applies the waste management system of goods harmful to the environment or the manager fails to apply the management system or applies it partly and does not fulfil the liabilities included in the agreement with the institution under subordination of the Ministry of Environmental Protection and Regional Development on management of the waste of goods harmful to the environment;

b) the taxpayer who has personally established and applies the waste management system for goods harmful to the environment or the manager has failed, within a month after the period of time laid down in laws and regulations, to submit the report referred to Clauses 4 and 5 of this Paragraph or the financial security referred to in Clauses 1 and 2 of this Section to the institution under subordination of the Ministry of Environmental Protection and Regional Development.

(3) The institution under subordination of the Ministry of Environmental Protection and Regional Development shall control the fulfilment of the operational programme of the waste management system for goods harmful to the environment, and also inform the State Revenue Service in writing by the 20th date of the next month following the quarter after it has taken a decision on exemption from the tax, and provide the necessary information thereto.

(4) If the management agreement with the institution under subordination of the Ministry of Environmental Protection and Regional Development and specified in laws and regulations has been entered into by the manager, he or she shall inform in writing his or her contract partners of the agreement entered into and the exemption from payment of the tax to be applied by indicating the date and number of the decision by the State Environmental Service which has been taken on the entering into of a management agreement and the application of exemption, and also indicating to which types of goods harmful to the environment the exemption shall be applied and for what time period the exemption has been granted.

(5) A person who brings in and for ensuring his or her economic activities uses electrical and electronic equipment shall not pay the tax if in the supply contract is included guarantees that the used electrical and electronic equipment shall be sent back to the supplier state.

(6) A taxpayer shall forfeit the right to exemption from the tax specified in this Section, if the agreement referred to in Paragraph one, Clause 1 or 2 of this Section has been terminated in accordance with the procedures laid down in laws and regulations because a taxpayer or manager fails to apply the management system or applies it partly and does not fulfil the liabilities included in the agreement with the institution under subordination of the Ministry of Environmental Protection and Regional Development. Application of exemption from the payment of tax shall be terminated starting from the first day of the first month of the next quarter following the day of agreement termination.

(7) A taxpayer shall forfeit the right to exemption from the tax specified in this Section, if the agreement referred to in Paragraph one, Clause 1 or 2 of this Section has been terminated in accordance with the procedures laid down in laws and regulations because a taxpayer or manager fails to submit the report referred to in Paragraph two, Clauses 4 and 5 of this Section to the institution under subordination of the Ministry of Environmental Protection and Regional Development within a month after the period of time specified in laws and regulations. Application of exemption from the payment of tax shall be terminated starting from the first day of the first month of the next quarter following the day of agreement termination.

(8) Challenge and appeal of a decision referred to in Paragraph six and seven of this Section on unilateral withdrawal from an agreement in cases when a taxpayer or manager fails to apply the management system or applies it partly and does not fulfil the liabilities included in the agreement with the institution under subordination of the Ministry of Environmental Protection and Regional Development and in cases when a taxpayer or manager has failed to submit the report referred to in Paragraph two, Clauses 4 and 5 of this Section to the institution under subordination of the Ministry of Environmental Protection and Regional Development within a month after the period of time specified in laws and regulations shall not suspend the operation of the decision.

(9) [26 April 2018]

(10) [9 July 2020]

(11) Upon termination of the management agreement laid down in this Section, within four months after the day when the agreement was terminated:

1) a taxpayer who has established and applied the waste management system for goods harmful to the environment and has not paid the tax shall submit to the institution under subordination of the Ministry of Environmental Protection and Regional Development with which the agreement was entered into, a report on the management of the waste of goods harmful to the environment and the tax calculated for the time period from the beginning of the calendar year until the time when exemption from payment of the tax was discontinued;

2) a manager the contract partners of which did not pay the tax for goods harmful to the environment shall submit an audited report on the management of the waste of goods harmful to the environment and the tax calculated for the time period from the beginning of the calendar year until the time when exemption from payment of the tax was discontinued, to the institution under subordination of the Ministry of Environmental Protection and Regional Development with which the agreement regarding management was entered into.

[19 December 2006; 8 May 2008; 14 November 2008; 12 June 2009; 20 December 2010; 23 November 2016; 15 December 2016; 26 April 2018; 9 July 2020]

Section 10. Exemption from Payment of the Tax for the Emission of Carbon Dioxide

(1) The tax shall not be paid for the emission of carbon dioxide (CO₂) by operators of stationary technological installation and aircraft operators who are included in the scheme for emission allowance trading within the European Union and comply with the requirements of the law On Pollution regarding transfer of emission allowances.

(2) The tax shall not be paid for the emission of carbon dioxide (CO₂) which emerges while using renewable energy resources in stationary technological installations referred to in Annex 2 to the law On Pollution (including installations in which the manufacturing capacity or amount of the manufactured production does not exceed indicators referred to in Annex 2 to the law On Pollution).

[20 December 2010; 23 November 2020]

Section 11. Exemption from Payment of the Tax for the Utilisation of Substances Depleting the Ozone Layer

The tax for the utilisation of substances depleting the ozone layer shall not be paid by a merchant who in accordance with the technological and environmental protection requirements laid down in the laws and regulations regarding environmental protection, utilises ozone layer depleting substances for manufacturing other chemical substances if the substance depleting the ozone layer completely changes its chemical composition during the chemical transformation process.

Chapter II.¹
Financial Security and Setting in of a Case of Disbursement Thereof

[26 April 2018]

Section 11.¹ Purpose and Type of the Financial Security

(1) The financial security is a security for the tax payment by which the tax for such amount of a specific type of waste is fully or partly covered which has not been accepted, reused, or recovered in conformity with the requirements of laws and regulations and the agreement on ensuring of the operation of the deposit-refund scheme or the management agreement in a particular calendar year when exemption from payment of tax for vehicles, packaging, or disposable tableware and accessors or for goods harmful to the environment was applied in accordance with Section 7, 8, 8.¹, or 9 of this Law.

(2) The purpose of the financial security is to create an additional guarantee for execution of the tax payment liability if a taxpayer has not executed its liabilities in relation to payment of the tax in order to preclude that collection of the tax payment laid down in the decision of an institution under subordination of the Ministry of Environmental Protection and Regional Development might become encumbered or impossible.

(3) The amount of the financial security shall be calculated in conformity with the types of tax objects, tax rates, and the calculated amount of the tax in the period of validity of the financial security.

(4) A first demand guarantee letter issued by a credit institution or an insurance policy issued by an insurer which includes irrevocable commitment of the insurer to disburse the insurance compensation upon the first request of an institution under subordination of the Ministry of Environmental Protection and Regional Development, and also incontestability of such request shall be used as the financial security.

(5) The Cabinet shall determine:

1) the procedures for the calculation of the amount of the financial security, the minimum and maximum sum of the financial security;

2) the procedures by which the financial security shall be submitted, extended, and renewed.

[26 April 2018; 30 April 2020]

Section 11.² Setting in of a Case of Disbursement of the Financial Security

(1) Upon terminating a management agreement in the case referred to in Section 7, 8, or 9 of this Law for specific types of waste or upon terminating an agreement on ensuring of the operation of the deposit-refund scheme, and also if the manager or the operator of the deposit-refund scheme has not ensured the amounts of acceptance, collection, preparation for reuse and transfer for reuse, of recycling or recovery laid down in laws and regulations, however, the operation of the management agreement or the agreement on ensuring of the operation of the deposit-refund scheme is not terminated, the institution under subordination of the Ministry of Environmental Protection and Regional Development shall:

1) decide on the obligation to pay the tax and shall act as follows in relation to such decision in writing:

a) notify the manager or the operator of the deposit-refund scheme by indicating the total calculated sum of the tax, the sum of the financial security, the term of payment, and also the State budget account to which the payment must be transferred, and also the calculated part of the tax payment not covered by the financial security;

b) notify the provider of the financial security;

c) inform the contracting partners of the manager and the State Revenue Service;

2) decide on setting in of a case of disbursement of the financial security if the taxpayer has not made the calculated tax payment within the time period laid down in Section 27, Paragraph 4.¹ of this Law, and shall notify the following of such decision in writing:

a) the provider of the financial security by indicating the sum of the financial security, the term of payment - one month from the day when the decision was notified - and the State budget account to which the financial security must be transferred;

b) the taxpayer.

(2) Contesting and appeal of the decision laid down in Paragraph one of this Section shall not suspend its operation.

(3) The institution under subordination of the Ministry of Environmental Protection and Regional Development has the right to request that the provider of the financial security the term of operation of the financial security issued by which coincides with the period for which the tax has been calculated, or several providers of the financial security, if several financial securities had been in effect in the period for which the tax has been calculated, however, has not been paid - in proportion to the term of their operation, disburse the sum of the financial security until the end of the term of the financial security. The sum of the financial security to be disbursed shall be transferred to the State budget account indicated in the decision by indicating the identifier of the payment.

(4) If the tax has not been paid within the term laid down in Section 27, Paragraph 4.¹ of this Law and also the provider of the financial security has not made the payment upon the request of the institution under subordination of the Ministry of Environmental Protection and Regional Development:

1) the State Revenue Service shall, after receipt of the relevant information from the institution under subordination of the Ministry of Environmental Protection and Regional Development, recover from the provider of the security the sum of the tax which has been indicated in the decision and for which the financial security has been provided, on an uncontested basis;

2) if the financial security does not cover the calculated tax in full amount, the State Revenue Service shall, after receipt of the relevant information from the institution under subordination of the Ministry of Environmental Protection and Regional Development, recover the unpaid part of the sum indicated in the decision and the late payment charge calculated for missing the payment deadline from the taxpayer referred to in Section 3, Paragraphs 1.¹ and 1.² of this Law on an uncontested basis.

[26 April 2018; 30 April 2020]

Section 11.³ Period of Operation of the Financial Security

(1) The manager and the operator of the deposit-refund scheme must maintain the financial security valid in full amount throughout the period of operation of the agreement entered into with the institution under subordination of the Ministry of Environmental Protection and Regional Development on ensuring of the operation of the deposit-refund scheme or the management agreement, and one year after termination of operation of the abovementioned agreements.

(2) If the term of the financial security has expired and the manager or the operator of the deposit-refund scheme has not renewed and submitted the financial security to the institution under subordination of the Ministry of Environmental Protection and Regional Development, it shall suspend the application of exemption from payment of tax starting from the first day of the first month of the next quarter.

(3) After setting in of a case of disbursement of the financial security, the manager and the operator of the deposit-refund scheme must renew the financial security to full amount. If the manager or the operator of the deposit-refund scheme has not renewed and submitted the financial security to the institution under subordination of the Ministry of Environmental Protection and Regional Development within two months after setting in of the case of disbursement of the financial security, it shall suspend the application of exemption from payment of tax starting from the first day of the first month of the following next quarter.

(4) If application of exemption from payment of the tax has been suspended for the manager or the operator of the deposit-refund scheme, application of exemption shall be started anew after renewal and submission of the financial security to the institution under subordination of the Ministry of Environmental Protection and Regional Development starting from the first day of the first month of the next quarter.

[26 April 2018; 30 April 2020]

Chapter III
Calculation of the Tax for Extraction and Use of Natural Resources

Section 12. Limiting of Extraction and Use of Natural Resources

(1) In order to extract or use natural resources, a taxpayer shall obtain a permit, a licence specified in laws and regulations regarding environmental protection and use of subterranean depths or register a Category C polluting activity.

(2) In order to use natural resources extracted during construction of underground and surface structures, in economic activities, installation of surface water bodies, and the cleaning and deepening of river beds, and also in order to use the mineral resources extracted during economic activities for which the tax has not been paid, it shall be required to obtain a permit for use of natural resources in accordance with the procedures stipulated by the Cabinet.

(3) Tax for natural resources which are acquired in the construction of underground and surface structures, installation of surface water bodies, the cleaning and deepening of river beds and are used for economic activities shall be paid irrespective of the fact whether in accordance with the laws and regulations regarding the use of subterranean depths it is necessary to obtain a permit for use of natural resources. If the natural resources are used not for economic activities, but for personal use within the borders of one's own land, the tax for natural resources need not be paid. If in accordance with the laws and regulations regarding the use of subterranean depths a permit for use of natural resources is not necessary, the tax for natural resources used in economic activities shall be calculated as for the extraction of natural resources within limits.

[19 December 2006; 23 November 2020]

Section 13. General Requirements for Calculation of the Tax for Extraction and Use of Natural Resources

(1) The tax shall be calculated according to tax rates for each unit of extracted or used natural resource or pollution emitted into the environment. The tax shall be paid for the actual amount of extracted natural resources, and also for the volume of natural gas pumped into geological structures in the current tax period and the type and volume of environmental pollution.

(2) A taxpayer shall verify the type and volume of actually extracted or used natural resources or the volume of emitted pollution in accordance with the methods specified in laws and regulations, the relevant permit or licence, analyses performed by accredited laboratories, or standardised calculations.

(3) A taxpayer shall verify the accounting for the volume of the extracted and used natural resources and pollution.

(4) The tax for extraction and use of natural resources within the specified volume limits shall be calculated in accordance with the rates specified in Annexes to this Law.

(5) If within the tax period the taxpayer has extracted or used less natural resources than laid down in the limit, but cannot prove the actual amount, the tax shall be paid for the type and amount of extraction of natural resources or pollution complying with the limit.

(6) If the taxpayer has not extracted natural resources during the tax period, it shall be indicated in accounting documents and the regional environmental board shall be informed about it at the end of tax period. In such case the tax for the relevant tax period need not be paid.

(7) The tax shall be calculated and paid for mineral resources included in the authorisation for extraction of widespread mineral resources or the licence for use of subterranean depths and for by-products obtained during the process of extraction of mineral resources the extraction of which is not included in the authorisation for extraction of widespread mineral resources or the licence for use of subterranean depths but for which the tax shall be paid in accordance with Annex 1 to this Law.

[23 November 2016; 15 December 2016]

Section 14. Calculation of the Tax for the Volume of Natural Gas Pumped into Geological Structures in Current Tax Period

In accordance with the procedures stipulated by the Cabinet, the following tax rate shall be applied for the volume of natural gas pumped into geological structures in the current tax period:

1) EUR 0.0143 for pumping 100 cubic metres of natural gas;

2) [23 November 2016];

3) [23 November 2016];

4) [23 November 2016];

[19 September 2013; 23 November 2016]

Section 14.¹ Calculation of the Tax for Emission of PM₁₀ Particles in the Air when Carrying out Reloading of Bulk Freights in Open Terminals or other Open Reloading Sites

A person carrying out the reloading of bulk freights in open terminals or other open reloading sites, shall calculate the tax for emission of PM₁₀ particles in the air according to the volume specified in the limit by applying the tax rate specified in Annex 4 to this Law in twenty-fold amount.

[20 December 2010]

Section 15. Calculation of the Tax for Environmental Pollution in Performing Category C Polluting Activities

(1) The tax for the type and volume of pollution for Category C polluting activity shall be calculated and paid according to the type and volume declared by the taxpayer. The taxpayer shall ensure the registration of the type and volume of the pollution caused by the activity thereof.

(2) The volume of the pollution emitted into the environment shall be determined on the basis of conditions and methodologies laid down in the laws and regulations regarding environmental protection or using calculations.

(3) If installation operators perform Category C polluting activities in the fields of activity regarding which no conditions are laid down in laws and regulations, and it is also not possible to calculate the amount of polluting substances, the tax amount shall be specified in Paragraph five of this Section. A taxpayer shall pay the tax for each performed registration of Category C polluting activity. If a person has registered a Category C polluting activity and commenced economic activity during the time which does not coincide with the first month of the taxation period for the tax, the tax shall be calculated as one-twelfth of the annual tax rate for each month of the taxation period after registration.

(4) If a person who has registered a Category C polluting activity and pays the tax in the amount specified in Paragraph five of this Section has terminated the polluting activity or economic activity prior to the end of the taxation period, the tax shall be calculated as one-twelfth of the annual tax rate for each month of the taxation period until termination of the activity (including the month when the activity is terminated).

(5) The tax rates for environmental pollution in performing Category C polluting activities shall be as follows:

1) EUR 178 per year in 2021;

2) EUR 200 per year in 2022;

3) EUR 250 per year from 2023.

[19 December 2006; 8 May 2008; 12 June 2009; 20 December 2010; 19 September 2013; 23 November 2020]

Section 16. Calculation of the Tax for Emission of Carbon Dioxide (CO₂)

(1) A limit for the emission of carbon dioxide (CO₂) specified in Annex 4 to this Law is not defined, and the tax for the whole volume of emission of carbon dioxide (CO₂) shall be calculated, applying the rates specified in Annex 4 to this Law. The volume of carbon dioxide (CO₂) emission from stationary technological installations shall be calculated, taking into account the type and chemical composition of the heating fuel, raw materials and ancillary substances, volume of the heating fuel used, raw materials and ancillary substances, quantity of the manufactured production, lowest calorific value and oxidation factor or conversion factor.

(2) The procedures for the calculation of the volume of carbon dioxide (CO₂) emission shall be determined by the Cabinet.

Section 17. Calculation of the Tax for Volume of Greenhouse Gasses Emitted by Operators of Stationary Technological Installations and Aircraft Operators

[15 December 2016]

Section 18. Calculation of the Tax for Soil

The tax for soil shall be calculated and paid, if the soil is sold, in accordance with the tax rate specified in Annex 1 to this Law.

Section 19. Calculation of the Tax for Extraction of Water

The tax for the extraction of surface water and groundwater shall be paid if the extraction of water exceeds 10 cubic metres daily. If the limit for the extraction of water has been specified less than 10 cubic metres daily in the relevant permit of the taxpayer, the tax in accordance with Section 21 of this Law shall only be paid for the volume of water which has been extracted above the limit, in accordance with the tax rate specified in Annex 2 to this Law. To groundwater which is used as an ingredient of drinks or as an ingredient of food products in the production process, a tax rate for groundwater, including fresh water and spring water used in water supply, specified in Annex 2 to this Law shall be applied. The tax for extraction of groundwater, fresh water, mineral water and spring water for further sale shall be paid for the amount actually extracted in the taxation period.

[19 December 2006; 8 May 2008; 12 June 2009]

Section 19.¹ Calculation of the Tax for the Use of Water Resources for Production of Electricity in a Hydroelectric Power Plant

The tax rate for the use of water resources for production of electricity in a hydroelectric power plant shall be EUR 0.00853 per 100 cubic metres of the water that has flown through the hydrotechnical structure. The Cabinet shall determine the procedures by which the water flown through the hydrotechnical structure shall be calculated on the basis of the quantity of electricity produced and the efficiency coefficient of the operation of the hydroelectric station.

[6 November 2013; 23 November 2016]

Section 20. Calculation of the Tax for the Collection of Edible Park Snails (Helix pomatia L.) for Further Economic Utilisation

A tax rate of EUR 0.04 per kilogram shall be applied for the collection of edible park snails (Helix pomatia L.) for further economic utilisation in accordance with the procedures stipulated by the Cabinet.

[19 September 2013]

Section 20.¹ Calculation of the Tax for Waste Disposal or Incineration

(1) The tax for disposal of waste shall be calculated and paid for the actual quantity of waste disposed of at the waste landfill site by applying the tax rates laid down in Annex 3 to this Law.

(2) The tax shall not be paid for such quantity of waste which, in conformity with the issued permit for the performance of Category A or B polluting activities, is placed in the biodegradable waste recycling facility for the obtaining of biogas (in a bioreactor) and is regarded as recycled or recovered in accordance with the requirements of the Waste Management Law after implementation of such process.

(3) The tax shall be paid for such quantity of waste which, after placement in the biodegradable waste recycling facility for the obtaining of biogas (in a bioreactor) within the time period laid down in the permit for the performance of Category A or B polluting activities, is separated by sorting from the recycled or recovered fraction of waste and disposed of at the waste landfill site.

(4) The tax rate for incineration of waste in a waste incineration or co-incineration plant shall be EUR 15 per ton.

(5) The tax shall not be paid for such quantity of waste which is incinerated or co-incinerated in the rotary kiln of the installation for the production of cement clinker.

[14 November 2019 / Paragraph four shall come into force on 1 January 2021. See Paragraph 34 of Transitional Provisions]

Section 21. Calculation of the Tax for Unlawful Extraction or Use of Natural Resources

(1) The tax for extraction or use of natural resources or for pollution emitted into the environment above the volume specified in limits shall be calculated by applying the tax rate tenfold.

(2) If a person who extracts or uses natural resources or performs polluting activities has not obtained the necessary permit, licence or has not registered a Category C polluting activity, the tax shall be calculated by applying the tax rate tenfold.

(3) If the environment has been polluted or natural resources have been extracted without obtaining the necessary permit or registering a Category C polluting activity, it shall be assumed that the actual volume emitted or extracted is such as emitted or extracted by equipment of an equal capacity and operation profile in the calculated time period of use of that equipment, unless the taxpayer can prove the actual amount.

[23 November 2020]

Section 22. Calculation of the Tax for Pollution Emitted into the Environment due to Force Majeure or during a Certain Period of Time due to Atypical Operation of the Device

(1) The tax for pollution emitted into the environment due to force majeure shall be calculated for the whole volume of pollution in the same manner as for pollution emitted within specified limits, provided that the taxpayer has informed the State Environmental Service without delay, but not later than within one working day in writing and performed measures coordinated with the State Environmental Service in order to prevent further pollution.

(2) If the taxpayer has not informed the State Environmental Service of the occurrence of force majeure and has not performed measures in order to prevent further pollution, the volume of actually emitted pollution shall be added to the limit specified to the taxpayer. The tax for pollution of the environment within the specified limit shall be paid in accordance with the tax rate specified in Annexes to this Law, but for pollution emitted into the environment above the specified limit the tax shall be paid tenfold.

(3) The tax for pollution emitted into the environment due to atypical operation of the device, including adjusting or testing of a new device or a part thereof prior putting into service thereof or following the reconstruction in accordance with that specified in the technical documentation of the device, and also testing of the device or a part thereof in accordance with that specified in the technical documentation, shall be calculated for the whole volume of pollution in the same manner as for pollution emitted within specified limits, if the operator ensures the compliance with the provisions stipulated by the environmental protection institutions when the device is operating under atypical conditions.

[12 June 2009]

Chapter IV
Calculation of the Tax for Goods Harmful to the Environment, for Packaging, for Coal, Coke and Lignite (Brown Coal), for Disposable Tableware and Accessories, for Radioactive Substances, for Vehicles and for Fireworks

[6 November 2013]

Section 23. Calculation of the Tax for Goods Harmful to the Environment

(1) The tax for goods harmful to the environment shall be calculated according to the tax rates for types of goods in accordance with Annex 6 to this Law.

(1¹) The tax for goods harmful to the environment for the taxpayer referred to in Section 3, Paragraph 1.¹ of this Law shall be calculated, in accordance with Annex 6 to this Law, by the institution under subordination of the Ministry of Environmental Protection and Regional Development in conformity with the tax rates for the types of goods which have not been recycled or recovered.

(2) The tax for sale of goods harmful to the environment in Latvia or use of goods harmful to the environment for ensuring economic activities thereof shall be calculated in euros per each physical unit or weight unit of goods.

(3) [19 December 2006]

(4) [19 December 2006]

(5) The weight or number of goods harmful to the environment shall be justified by accounting documents. The taxpayer shall ensure for the accounting of goods harmful to the environment in order to justify tax calculations.

(6) The Cabinet shall determine:

1) the accounting documents to be used in confirming the weight of goods harmful to the environment and the information to be included therein;

2) the methods for the determination of the weight of the goods harmful to the environment if the taxpayer does not have accounting documents confirming the weight of the goods harmful to the environment at his or her disposal;

3) the procedures for the determination of a person who may perform the audit of the waste management system for the waste of goods harmful to the environment;

4) the procedures for the auditing of the waste management system for goods harmful to the environment.

[19 December 2006; 19 September 2013; 26 April 2018]

Section 23.¹ Calculation of the Tax for Coal, Coke, and Lignite (Brown Coal)

(1) The tax for coal, coke, and lignite (brown coal) shall be calculated in accordance with the rates referred to in Annex 9 to this Law for each weight unit of coal, coke, and lignite (brown coal) depending upon its thermal input.

(2) The weight and thermal input of coal, coke, and lignite (brown coal) shall be justified by accounting documents. The taxpayer shall ensure for the accounting of coal, coke, and lignite (brown coal) in conformity with the thermal input thereof in order to justify tax calculations.

(3) If the thermal input of coal, coke, and lignite (brown coal) in accounting documents is indicated in specified intervals, the highest limit of the interval shall be used for the calculation of the tax.

(4) [14 November 2019]

(5) [14 November 2019]

[19 December 2006; 8 November 2007; 14 November 2019]

Section 24. Calculation of the Tax for Packaging and for the Disposable Tableware and Accessories

(1) The tax for packaging and disposable tableware and accessories shall be calculated in accordance with the rates referred to in Annex 7 to this Law for each weight unit of packaging material type or each weight unit of disposable tableware or accessories material type.

(1¹) The tax for packaging and disposable tableware and accessories for the taxpayer referred to in Section 3, Paragraph 1.¹ of this Law shall be calculated by the institution under subordination of the Ministry of Environmental Protection and Regional Development in conformity with the rates laid down in Paragraph five of this Section or Annex 7 to this Law for each weight unit of the type of packaging material or for each weight unit of the type of the material of tableware or accessories which has not been recycled or recovered.

(1²) The tax for deposit packaging for the taxpayer referred to in Section 3, Paragraph 1.² of this Law shall be calculated by the institution under subordination of the Ministry of Environmental Protection and Regional Development in conformity with the rates laid down in Annex 7 to this Law for each weight unit of the type of packaging material which has not been accepted or recovered.

(2) The type and weight of packaging material and the type and weight of material of disposable tableware and accessories shall be substantiated with accounting documents. The taxpayer shall ensure the accounting of packaging and disposable tableware and accessories in order to substantiate tax calculations.

(3) The Cabinet shall determine:

1) accounting documents confirming the weight and type of packaging materials and the information to be included therein;

2) the authority which issues the statement regarding the packaging material and the type and weight of disposable tableware and accessories material if the taxpayer does not have the necessary accounting documents confirming the material of packaging or the type and weight of disposable tableware and accessories material at his or her disposal;

3) the methodology for specifying the type and weight of packaging material if the taxpayer does not have the accounting documents confirming the type and weight of packaging material at his or her disposal;

4) the maximum tolerances from the weight norm of packaging and disposable tableware and accessories if the weight is substantiated with accounting documents;

5) the methodology for the determination of type and weight of disposable tableware and accessories material if the taxpayer does not have the accounting documents confirming the type and weight of disposable tableware and accessories material at his or her disposal;

6) the procedures for the determination of a person who may perform the audit of the used packaging management systems and the management systems for disposable tableware and accessories;

7) the procedures for auditing the used packaging management systems and the management systems for disposable tableware and accessories;

8) the procedures for the labelling of packaging made of bioplastics and disposable tableware and accessories and the information (labelling) to be indicated on such packaging and such tableware and accessories on the type of materials.

(4) A taxpayer who pays the tax for packaging and who in accordance with the laws and regulations regarding environmental protection does not have to perform the recycling and recovery of the used packaging shall calculate the tax in accordance with the tax rates specified in Annex 7 of this Law for each weight unit of packaging material type or, if it is not possible to ensure substantiation of the type and weight of packaging material with accounting documents, EUR 120 per year.

(5) In the case referred to in Section 4, Paragraph five of this Law the following tax rate shall be applied to plastic carrier bags:

1) lightweight plastic carrier bags - EUR 4.80 per one kilogram;

2) plastic carrier bags the thickness of the material of which exceeds 50 microns - EUR 1.50 per one kilogram.

(6) The tax rate specified in Clause 2 of Annex 7 to this Law for packaging and disposable tableware and accessories of plastic (polymer) source materials shall be applied for packaging and disposable tableware and accessories on which the information (labelling) laid down in laws and regulations is not indicated.

(7) Tax rates for packaging of composite materials (laminates) specified in Annex 7 to this Law shall be applied according to the material which is prevailing in terms of weight.

[13 December 2007; 14 November 2008; 19 September 2013; 6 November 2013; 15 December 2016; 26 April 2018; 30 April 2020; 9 July 2020]

Section 24.¹ Calculation of the Tax for Fireworks

A taxpayer shall calculate and pay the tax for fireworks marketed in the Republic of Latvia or used for ensuring of his or her economic activity by applying the tax rate in the amount of three per cent from the purchase value of such fireworks. The taxpayer shall ensure accounting of fireworks marketed and used for ensuring of his or her economic activity in order to justify the calculation of the tax.

[15 December 2016]

Section 25. Calculation of the Tax for Radioactive Substances

The tax for radioactive substances, based upon documents certified by the supplier regarding the composition of the radioactive substances and the total radioactivity, shall be calculated in accordance with the rates referred to in Annex 8 to this Law for each cubic metre of radioactive waste which has been created utilising such substances, and also taking into account the following conditions:

1) the tax for utilisation of radioactive substances shall be calculated in proportion to the radioactivity of that radioactive waste which will be created utilising radioactive substances, pursuant to the relevant tax rate, but the tax shall not be less than 0,001 from the rate for radionuclide groups 1, 2, 3, 4, 5, and 6 and 0.2 from the rate for radionuclide group 7;

2) if an open and a closed radioactive radiation source are used concurrently, the tax shall be calculated for each radioactive radiation source separately, taking into account the conditions referred to Clause 1 of this Section.

Section 26. Calculation of the Tax for Vehicles

(1) The tax rate:

1) for one vehicle which is registered permanently for the first time in Latvia shall be EUR 55;

2) for one vehicle which is being removed from the register for writing-off in the joint stock company Road Traffic Safety Directorate without a certificate of destruction of an end-of-life vehicle, if a certificate of destruction of an end-of-life vehicle should be issued, shall be EUR 165.

(2) The Cabinet shall determine:

1) the requirements for one person who is entitled to perform the audit of the management system for end-of-life vehicles;

2) the procedures for the auditing of the management system for end-of-life vehicles.

[20 December 2010; 19 September 2013; 6 November 2013; 23 November 2016; 3 April 2019]

Chapter V
Payment of the Tax, Reports on the Calculated Tax, Division of Payments of the Tax, and Use of the Local Government Basic Budget Resources Obtained from Payments of the Tax

[14 November 2019]

Section 27. Procedures for the Payment of the Tax and Submission of Reports on Calculated Natural Resources Tax

(1) The Cabinet shall determine:

1) the procedures for the accounting of type and quantity of extracted or used natural resources, environmental pollution and goods harmful to the environment, packaging, disposable tableware and accessories, radioactive substances and fireworks;

2) the procedures for the calculation and payment of the tax;

3) the report form for the calculated natural resources tax and procedures for filling in and submission thereof.

(2) A taxpayer shall, by the 20th date of the next month following the quarter, calculate and submit a report on the calculated natural resources tax (hereinafter - the report) to the State Revenue Service for the previous quarter, except for the cases referred to in Paragraph four of this Section when the report for the previous year shall be submitted by 20 January of the following year.

(3) A taxpayer shall, by the 23rd date of the next month following the quarter, pay the tax for the preceding quarter into the single tax account if it has not been laid down otherwise in this Section.

(4) A taxpayer shall, by the 20 January of the following year, calculate and, by the 23 January, pay the tax for the previous year into the single tax account:

1) pollution emitted into the environment due to Category C polluting activities regardless of the tax amount calculated;

2) the calculated tax if, according to the basic rates, the tax amount does not exceed EUR 142.29 per year for all taxable objects of the taxpayer in total.

(4¹) The taxpayer referred to in Section 3, Paragraphs 1.¹ and 1.² of this Law shall make the calculated payment of the tax within 30 days after the institution under subordination of the Ministry of Environmental Protection and Regional Development has taken the decision on setting in of the obligation to pay the tax.

(5) A taxpayer shall pay the tax for a vehicle prior to the first permanent registration of the vehicle in Latvia. If the vehicle is deleted from the register within six months after registration because it is brought out of Latvia, the tax paid shall be reimbursed within 30 days after receipt of the relevant submission by the taxpayer. The Cabinet shall determine the procedures for the payment of the tax and reimbursement of the tax paid for the vehicle.

(6) If the tax is paid (or is intended to be paid) in accordance with Paragraph five of this Section, but the vehicle is not brought out of Latvia or is brought out and then again brought back into Latvia and re-registered in Latvia, the tax shall be paid in accordance with this Section.

(7) A taxpayer shall submit a report to the State Revenue Service on the preceding quarter by the 20th date of the next month following the quarter, except for the cases referred to in Paragraph four of this Section when the report on the preceding year shall be submitted by 20 January of the following year. A taxpayer who is exempt from the payment of the tax in conformity with Section 8 or 9 of this Law shall not submit a report to the State Revenue Service for the period in which the exemption from payment of the tax was applied. For this period the taxpayer or manager shall submit to the Ministry of Environmental Protection and Regional Development or the subordinate institutions thereof the report laid down in the laws and regulations regarding the procedures by which exemptions from the payment of tax for packaging, disposable tableware and accessories and goods harmful to the environment, regarding the calculated tax.

(7¹) A taxpayer who is paying the tax for the amount of waste of end-of-life vehicles, used packaging, or disposable tableware and accessories, deposit packaging, or goods harmful to the environment in relation to which exemption from payment of the tax has been applied in conformity with Section 7, 8, 8.¹, or 9 of this Law and which has not been accepted, reused, recycled, or recovered in conformity with the requirements of the laws and regulations and the agreement on ensuring of the operation of the deposit-refund scheme or the conditions of the management agreement, shall not provide a report to the State Revenue Service.

(8) Persons who pay tax for the first permanent registration of the vehicle in Latvia shall not submit a report. The State joint stock company Road Traffic Safety Directorate by the 5th date of the next month following the quarter shall send to the State Revenue Service information in electronic form on the vehicles permanently registered in Latvia for the first time to which Section 3, Paragraph one of the End-of-Life Vehicles Management Law is applicable.

(9) If a foreign person who is not registered as a taxpayer in the State Revenue Service is the first to sell goods harmful to the environment or goods in packaging or to use them for ensuring economic activities thereof in the Republic of Latvia, the permanent representative of the foreign person, recipient of the goods, or other person in Latvia with whom a written agreement regarding assumption of liabilities in relation to the tax has been entered into shall pay the tax and submit a report instead of the foreign person.

(10) If a foreign person who is not registered as a taxpayer in the State Revenue Service and does not have permanent representation or who has not entered into a written agreement regarding the assumption of liabilities in relation to the tax sells goods harmful to the environment or goods in packaging or uses them for ensuring economic activities thereof in the Republic of Latvia, the tax in the State budget shall be paid by the foreign person itself. In such a case the foreign person shall not submit a report.

(11) A taxpayer who sells goods harmful to the environment or goods in packaging to another person who brings them out from the Republic of Latvia and can substantiate the bringing out of the relevant goods harmful to the environment or goods in packaging with documents:

1) shall not pay the tax if the sale and bringing out of goods harmful to the environment or goods in packaging has taken place in one tax payment period;

2) shall count in the paid tax amount as advance payment of tax if the sale and bringing out of goods harmful to the environment or goods in packaging has taken place in different tax payment periods and the taxpayer can substantiate the tax payment with documents.

(12) A person who has not performed taxable activities in the taxation period shall not provide a report on the relevant taxation period to the State Revenue Service.

(13) A taxpayer who, to ensure his or her economic activity, imports goods harmful to the environment used for the production of new goods, if these new goods are exported from the Republic of Latvia and a taxpayer can substantiate the export of the relevant goods with documents:

1) shall not pay the tax if the import of goods harmful to the environment, use of goods for the production of new goods and the export of these new goods has taken place in one tax payment period;

2) shall include the paid tax amount as advance payment of tax if the import of goods harmful to the environment, use of goods for the production of new goods and the export of these new goods has taken place in different tax payment periods.

[19 December 2006; 14 November 2008; 12 June 2009; 20 December 2010; 19 September 2013; 6 November 2013; 23 November 2016; 15 December 2016; 26 April 2018; 30 April 2020; 23 November 2020 / The new wording of Paragraph three and the introductory part of Paragraph four shall come into force on 1 January 2021. See Paragraph 30 of Transitional Provisions]

Section 28. Inclusion of Tax Payments in the Budget

(1) The State Revenue Service shall divide tax payments according to budgets pursuant to place of registration of the taxpayer.

(2) Tax payments for the extraction or use of natural resources or environmental pollution (except for cases referred to in Paragraphs three and four of this Section), within the amounts specified by the limits, shall be included as follows:

1) 60 per cent into the State basic budget;

2) 40 per cent into the basic budget of such local government in the territory of which the relevant activity is performed.

(3) The tax payments for:

1) the use of useful properties of the subterranean depths by pumping natural gas into geological structures shall be included into the basic budget of such local government in the territory of which the relevant activity is performed (if the activity takes place in the territory of several local governments - proportionally to the territory utilised);

2) the use of radioactive substances shall be included into the basic budget of such local government in the territory of which the radioactive waste disposal site is located.

(4) Payments of the tax shall be included into the State basic budget for:

1) the incineration of waste;

2) carbon dioxide (CO₂) emissions into air;

3) goods harmful to the environment, packaging, disposable tableware and accessories, and vehicles;

4) coal, coke, lignite (brown coal), and fireworks;

5) the use of water resources for production of electricity in a hydroelectric power plant;

6) the extraction and use of unlawful natural resources.

(4¹) Tax payments for the disposal of waste in accordance with Paragraph 1 of Annex 3 to this Law shall be paid:

1) in 2021, 100 per cent into the State basic budget;

2) in 2022, 90 per cent into the State basic budget and 10 per cent into the basic budget of such local government in the territory of which waste is disposed of;

3) from 2023, 85 per cent into the State basic budget and 15 per cent into the basic budget of such local government in the territory of which waste is disposed of.

(4²) Tax payments for the disposal of waste in accordance with Paragraph 2 of Annex 3 to this Law shall be paid:

1) 80 per cent into the State basic budget;

2) 20 per cent into the basic budget of such local government in the territory of which waste is disposed of.

(5) Fine payments collected for the violations of this Law shall be paid into the State basic budget.

(6) Late payment charge for tax payments shall be paid into the State basic budget and the basic budget of a local government in accordance with the division specified in Paragraphs two, three, four, 4.¹ and 4.² of this Section.

[19 December 2006; 12 June 2009; 6 November 2013; 23 November 2016; 14 November 2019; 23 November 2020]

Section 29. Use of the Local Government Basic Budget Resources Obtained from Payments of the Tax

(1) Local government basic budget resources obtained from payments of the tax and the resources of the environmental protection fund established by a local government shall only be used for the financing of such measures and projects which are related to environmental protection, for example, education and instruction in the field of environmental protection, environmental monitoring, preservation and protection of biological diversity, air protection and climate change, study, evaluation, renewal of environmental and natural resources, water protection, protection and restoration of soils and the ground, strengthening of the performance of environmental protection institutions and public environment inspectors, waste management, radioactive waste administration. The local government may also use the basic budget resources or the resources of the environmental protection fund established by the local government as compensation to residents residing in an area subject to the impact of a waste landfill site and for covering the administration costs for the account of closing of the landfill site opened in the Treasury.

(2) The local government may establish an environmental protection fund of the local government by using the basic budget resources obtained from payments of the tax.

[14 November 2019]

Chapter VI
Tax Administration

Section 30. Competence of Tax Administration

(1) The Ministry of Environmental Protection and Regional Development and the institutions subordinate thereto shall control the use of natural resources, the amount of goods harmful to the environment, coal, coke and lignite (brown coal), packaging and radioactive substances used for ensuring economic activities and the conformity with norms for recovery of the used packaging, and also the amount of fireworks.

(2) Calculation of the tax shall be controlled by the Ministry of Environmental Protection and Regional Development, the institutions subordinate thereto and the State Revenue Service.

(3) Control, accounting, collection, and distribution of tax payments shall be performed by the State Revenue Service.

(4) The Ministry of Environmental Protection and Regional Development, the institutions subordinate thereto, and the State Revenue Service shall cooperate in the implementation of this Law and in the exchange of information and data related to tax and application thereof on regular basis.

(5) The institution under subordination of the Ministry of Environmental Protection and Regional Development shall supervise and control the application of the extended producer responsibility scheme.

[19 December 2006; 20 December 2010; 6 November 2013; 9 July 2020]

Chapter VII
Liability

Section 31. Liability of Reduction of Tax Base and Other Violations of the Law

(1) Also a fine shall be collected from the taxpayer in twofold amount of the unpaid tax according to the basic rates in the following cases:

1) for the extraction or use of natural resources or the amount of pollution emitted into the environment not indicated (hidden) in reports;

2) for the amount of goods harmful to the environment, packaging, coal, coke and lignite (brown coal), disposable tableware and accessories, radioactive substances of fireworks sold or used for ensuring economic activities thereof not indicated (hidden) in reports;

3) if the taxpayer has provided incomplete information to the manager in the case referred to in Section 7, 8, or 9 of this Law or to the operator of the deposit-refund scheme referred to in Section 8.¹, Paragraph one of this Law on the amount of tax objects or has not indicated it at all and recycling or recovery has not been performed in the corresponding amount.

(2) The fine for packaging provided in Paragraph one, Clause 2 of this Section shall be calculated in accordance with the procedures laid down in Section 24, Paragraph three of this Law provided that costs related to the issuance of the statement of the institution stipulated by the Cabinet is covered by taxpayer.

(3) [26 April 2018]

(4) [26 April 2018]

[19 December 2006; 8 May 2008; 14 November 2008; 12 June 2009; 20 December 2010; 6 November 2013; 23 November 2016; 15 December 2016; 26 April 2018; 30 April 2020]

Section 32. Late Payment Charge

Late payment charge shall be calculated and collected in accordance with the procedures and amounts laid down in the law On Taxes and Fees.

Transitional Provisions

1. With the coming into force of this Law, the law On Natural Resources Tax (Latvijas Republikas Saeimas un Ministru Kabineta Ziņotājs, 1995, No. 22; 1997, No. 3; 2000, No. 10; 2002, No. 3; 2004, No. 2, 10) is repealed.

2. Until 1 July 2006 Cabinet Regulation No. 555 of 29 June 2004, Procedures for Calculation and Payment of Natural Resources Tax, shall be in force insofar as it is not in contradiction with this Law.

3. Until 31 December 2006 Cabinet Regulation No. 270 of 25 June 2002, Procedures for Application of Natural Resources Tax Relief to Undertakings (Companies) Implementing a Voluntary Programme for the Management of Packaging Waste, shall be in force insofar as it is not in contradiction with this Law.

4. The Cabinet shall, by 1 July 2006 issue the regulations referred to in this Law, except for the regulations referred to Section 9 of this Law which the Cabinet shall issue by 1 April 2006. The Cabinet shall, by 1 October 2006, issue the regulations referred to in Section 23, Paragraph six, Clauses 3 and 4 and the regulations referred to in Section 24, Paragraph three, Clauses 6 and 7 of this Law.

5. Section 8 of this Law shall come into force on 1 January 2007.

6. Section 27, Paragraph two of this Law regarding submission of report in electronic form for coordination in the State Revenue Service shall be applicable from the day when a secure electronic signature is ensured for the electronic document. Until then the report for the preceding quarter shall be submitted to the relevant regional environmental board of the State Revenue Service in paper form and, where possible, in electronic form.

7. Tax paid in subsidies until 30 June 2006 for goods harmful to the environment shall be reimbursed from grants provided to the State Environmental Protection Fund in annual State Budget Law for legal persons who in accordance with the technological and environmental protection requirements laid down in laws and regulations perform recycling or recovery of waste of these goods in the territory of the Republic of Latvia or bring out such waste for recovery or recycling outside the territory of the Republic of Latvia, and also for implementation of the target programme.

8. Until 1 October 2006 the Ministry of Environment on the basis of the recommendation of the Packaging Management Council is entitled to specify exemptions from tax up to 80 per cent to merchants who implement a voluntary management programme for used packaging in accordance with Cabinet Regulation No. 270 of 25 June 2002, Procedures for Application of Natural Resources Tax Relief to Undertakings (Companies) Implementing a Voluntary Programme for the Management of Packaging Waste and in accordance with the criteria and requirements for voluntary management programmes of the used packaging as stipulated by the Cabinet. Exemptions from the tax in accordance with the Cabinet regulations referred to in this Clause may be specified for a time period not longer than until 31 December 2006 and applied until the end of this time period.

9. Exemptions from the tax granted to packagers prior to coming into force of this Law shall be applied until the end of the relevant time period, but not longer than until 31 December 2006.

10. In addition to the tax calculated and paid for the volume of packaging which is not recycled or recovered up to 31 December 2006 in accordance with the norms of recycling or recovery of the packaging waste laid down in the Packaging Law and other laws and regulations governing packaging management, a fine triple the amount of tax rate shall be calculated and paid. The taxpayer shall calculate and pay the fine for the amount of unrecycled or non-recovered packaging after submission of the annual report specified in the Packaging Law to the regional environmental board of the State Environmental Service or the Environment State Bureau. If, upon examination of the annual report, the regional environmental board determines that the norms of recycling or recovery of the packaging waste were not fulfilled, the environmental State inspector shall draw up an inspection act and present it to the taxpayer. If the taxpayer has not paid the fine, the decision on the amount of the tax to be additionally paid into the budget of the State Revenue Service, indicating the time period for payment of the additionally calculated sum. The taxpayer shall make the additional payments of the tax according to the decision within 20 days after becoming acquainted with the decision. The State Revenue Service has the right to recover the indicated amount on an uncontested basis.

[19 December 2006; 12 June 2009]

11. The conditions of exemption from the tax granted to the manufacturer of vehicles or the authorised representative thereof shall not change after coming into force of this Law until the end of time period of exemption from the relevant tax.

12. The tax paid for the vehicle until 31 December 2006 shall be reimbursed in the form of grants to the end-of-life vehicle recycling company for collected (also collected discarded end-of-life vehicles) and recycled vehicles, and also for the implementation of target programmes in accordance with the Management of End-of-Life Vehicles Law. The end-of-life vehicle recycling company may not receive grants for recycled vehicles for the management of which this company has entered into an agreement with the relevant manufacturer of vehicles or the authorised representative thereof if the manufacturer of the vehicles or authorised representative thereof is exempted from payment of the tax.

13. The reports referred to in Section 8, Paragraph four, Clause 4 and Section 9, Paragraph two, Clause 4 of the Law shall be audited from year 2008 when reports on year 2007 shall be submitted to the Ministry of Environment.

14. The Cabinet shall, by 1 July 2007, issue the new regulations provided for in Section 4, Paragraph three, Clauses 1 and 2, Section 4, Paragraph four, Section 12, Paragraph two, Section 14, Section 15, Paragraph one, Section 16, Paragraph two, Section 17, Section 20, Section 23, Paragraph six, Clauses 1 and 2, Section 24, Paragraph three, Clauses 1, 2, 3, 4, and 5, Section 27, Paragraph one, Clauses 1, 2, and 3 of this Law. Up to the day of the coming into force of such regulations, but not longer than up to 1 July 2007, Cabinet Regulation No. 504 of 20 June 2006, Procedures for the Calculation and Payment of Natural resources Tax, insofar as it is not in contradiction with this Law.

[19 December 2006]

15. Amendments to Sections 7, 8, and 9 of this Law shall come into force on 1 July 2008.

[8 May 2008]

16. The Cabinet shall, by 1 July 2008, issue new regulations provided for in Section 7, Paragraph two of this Law. Until the day of the coming into force of such regulations, but not longer than until 1 July 2008, Cabinet Regulation No. 503 of 20 June 2006, Procedures for the Payment and Refund of Natural Resources Tax for Vehicles and Procedures for Exemption from Payment of Natural Resources Tax for Vehicles, shall be in force, insofar as it is not in contradiction with this Law.

[8 May 2008]

17. The Cabinet shall, by 1 July 2008, issue new regulations provided for in Section 8, Paragraph two and in Section 9, Paragraph two of this Law. Until the day of the coming into force of such regulations, but not longer than until 1 July 2008, Cabinet Regulation No. 915 of 6 November 2006, Procedures for Exemption from the Natural Resources Tax for Packaging and Disposable Tableware and Accessories, and Cabinet Regulation No. 437 of 26 June 2007, Procedures for Exemption from Payment of Natural Resources Tax for Goods Harmful to the Environment, shall be in force, insofar as they are not in contradiction with this Law.

[8 May 2008]

18. Amendments to Section 19 of this Law in respect of specification of tax rate for groundwater which is used as an ingredient of drinks or as an ingredient of food products in the production process shall be applied starting from 1 January 2008.

[8 May 2008]

19. The Cabinet shall, by 1 April 2009, issue the regulations provided for in Section 24, Paragraph three, Clause 8 of this Law.

[14 November 2008]

20. The requirements referred to in Section 24, Paragraph six of this Law shall come into force on 1 January 2010.

[14 November 2008; 12 June 2009]

21. Section 7, Paragraph nine of this Law in respect of exemption of a person from payment of the tax shall come into force on 1 April 2011.

[20 December 2010]

22. The reports referred to in Section 7, Paragraph two, Clause 5 of this Law shall be audited starting from 2012 by submitting a report for 2011 to the institution under subordination of the Ministry of Environmental Protection and Regional Development.

[20 December 2010]

23. The requirements referred to in Section 17 if this Law in respect of aircraft operators shall be applicable starting from 1 January 2013.

[20 December 2010]

24. The Cabinet shall, by 28 February 2011, issue the regulations referred to in Section 7, Paragraph two, Paragraph ten and Section 26, Paragraph two of this Law. Until the day of coming into force of these regulations, but no longer than until 28 February 2011, Cabinet Regulation No. 450 of 17 June 2008, Regulation Regarding Payment and Refund Procedure of Natural Resources Tax for Vehicles and Regarding Procedure for Exemption from the Payment of Natural Resources Tax for Vehicles, shall be applied insofar as it is not in contradiction with this Law.

[20 December 2010]

25. On the basis of the norms that were in force until 31 December 2010, the exemption from the tax granted for the manufacturer of the vehicle or the authorised representative thereof shall be valid until the end of the term of exemption from the relevant tax.

[20 December 2010]

26. The Cabinet shall, not later than by 30 June 2017, issue the regulations referred to in Section 8, Paragraph two, Clause 8 of this Law.

[15 December 2016]

27. Amendments to Section 1, Clause 10 of this Law in relation to the deletion of this Clause, to the second sentence of Section 4, Paragraph five in relation to the deletion of the words "or oxy-degradable plastic", to Section 24, Paragraph three, Clause 8 in relation to the deletion of the words "or oxy-degradable plastic", to Clause 2 of Table in relation to the deletion of the words "or oxy-degradable plastic", and to Clause 5 of Table of Annex 7 in relation to the deletion of the words "or oxy-degradable plastic" shall come into force on 1 July 2018.

[26 April 2018]

28. The Cabinet shall, by 1 June 2018, issue the regulations referred to in Section 11.¹, Paragraph five of this Law.

[26 April 2018]

29. The requirements in relation to the financial security for managers and taxpayers shall be applicable from 1 July 2018. The manager and the taxpayer who have entered into an agreement with the institution under subordination of the Ministry of Environmental Protection and Regional Development until 30 June 2018 shall submit the financial security laid down in Section 11.¹ of this Law thereto by 30 December 2018.

[26 April 2018]

30. Amendments to Section 27, Paragraphs three and four of this Law shall come into force on 1 January 2021.

[26 April 2018]

31. Upon terminating the management contract in the case referred to in Section 7, 8, or 9 of this Law, and also in case when the manager has not ensured the recycling or recovery amounts laid down in the laws and regulations for specific types of waste, however, the operation of the management contract is not terminated, the institution under subordination of the Ministry of Environmental Protection and Regional Development in relation to the fulfilment of the laid down requirements for 2017 shall decide on an obligation to pay the tax in accordance with the conditions of Section 31, Paragraph three of this Law which were in force during the taxation period when the violation was committed.

[26 April 2018]

32. The Cabinet shall, by 1 December 2018, issue the regulations provided for in Section 8, Paragraph two, Clauses 11 and 12, and also Section 9, Paragraph two, Clauses 10 and 11 of this Law.

[26 April 2018]

33. Section 8, Paragraph 1.¹ of this Law and amendment on the new wording of Section 8, Paragraph four shall come into force on 1 July 2019.

[3 April 2019]

34. Amendments to Section 3, Paragraph one, Clause 1, Sub-clause "d", Section 4, Paragraph one, Clause 3 of this Law and Section 20.¹, Paragraph four of this Law shall come into force on 1 January 2021.

[14 November 2019]

35. Exemption from payment of the tax for deposit packaging in accordance with Section 8.¹ of this Law shall be applied from 1 February 2022.

[30 April 2020]

36. Application of exemption from payment of the tax for deposit packaging shall be discontinued for a taxpayer who has entered into an agreement with the operator of the deposit-refund scheme on participation in the deposit-refund scheme from 31 January 2022 in conformity with Section 8 of this Law.

[30 April 2020]

37. The institution under subordination of the Ministry of Environmental Protection and Regional Development shall submit the information referred to in Section 8.¹, Paragraph two of this Law to the State Revenue Service for the first time until 1 April 2022.

[30 April 2020]

38. Starting from 1 January 2022, the requirements of Section 6.¹ of this Law shall be binding on the extended producer responsibility schemes which have commenced the operation prior to 4 July 2018 and in the time period from 4 July 2018 until the day when this Section comes into force.

[9 July 2020]

39. Section 8., Paragraphs 1.² and 1.³ of this Law shall come into force on 1 January 2022.

[9 July 2020]

Informative Reference to the European Union Directives

[8 May 2008; 12 June 2009; 20 December 2010; 15 December 2016; 9 July 2020]

1. This Law contains legal norms arising from:

1) Directive 2003/87/EC of the European Parliament and of the Council of 13 October 2003 establishing a scheme for greenhouse gas emission allowance trading within the Community and amending Council Directive 96/61/EC;

2) Council Directive 2003/96/EC of 27 October 2003 restructuring the Community framework for the taxation of energy products and electricity (Text with EEA relevance);

3) Council Directive 2004/74/EC of 29 April 2004 amending Directive 2003/96/EC as regards the possibility for certain Member States to apply, in respect of energy products and electricity, temporary exemptions or reductions in the levels of taxation;

4) Directive 2000/53/EC of the European Parliament and of the Council of 18 September 2000 on end-of life vehicles;

5) Directive 2002/96/EC of the European Parliament and of the Council of 27 January 2003 on waste electrical and electronic equipment (WEEE);

6) Directive 2003/108/EC of the European Parliament and of the Council of 8 December 2003 amending Directive 2002/96/EC on waste electrical and electronic equipment (WEEE);

7) European Parliament and Council Directive 94/62/EC of 20 December 1994 on packaging and packaging waste;

8) Directive 2004/12/EC of the European Parliament and of the Council of 11 February 2004 amending Directive 94/62/EC on packaging and packaging waste;

9) Directive 2006/66/EC of the European Parliament and of the Council of 6 September 2006 on batteries and accumulators and waste batteries and accumulators and repealing Directive 91/157/EEC (Text with EEA relevance);

10) Directive 2008/101/EC of the European Parliament and of the Council of 19 November 2008 amending Directive 2003/87/EC so as to include aviation activities in the scheme for greenhouse gas emission allowance trading within the Community;

11) Directive 2008/98/EC of the European Parliament and of the Council of 19 November 2008 on waste and repealing certain Directives;

12) Directive (EU) 2015/720 of the European Parliament and of the Council of 29 April 2015 amending Directive 94/62/EC as regards reducing the consumption of lightweight plastic carrier bags (Text with EEA relevance);

13) Directive 2012/19/EU of the European Parliament and of the Council of 4 July 2012 on waste electrical and electronic equipment (WEEE) (Text with EEA relevance);

14) Directive (EU) 2018/851 of the European Parliament and of the Council of 30 May 2018 amending Directive 2008/98/EC on waste (Text with EEA relevance).

2. The legal norms have been coordinated with the European Commission and European Union Member States in accordance with Directive 98/34/EC of the European Parliament and of the Council of 22 June 1998 laying down a procedure for the provision of information in the field of technical standards and regulations and Directive 98/48/EC of the European Parliament and of the Council of 20 July 1998 amending Directive 98/34/EC laying down a procedure for the provision of information in the field of technical standards and regulations.

This Law shall come into force on 1 January 2006.

This Law has been adopted by the Saeima on 15 December 2005.

President V. Vīķe-Freiberga

Rīga, 29 December 2005

Law on Natural Resources Tax
Annex 1

[14 November 2019]

Tax Rates for Extraction of Natural Resources

Law on Natural Resources Tax
Annex 2.

[23 November 2016]

Tax Rates for Extraction of Water

Law on Natural Resources Tax
Annex 3

[23 November 2020]

Tax Rates for Disposal of Waste

Law on Natural Resources Tax
Annex 4

[23 November 2020]

Tax Rates for Air Pollution

Law on Natural Resources Tax
Annex 5

[6 November 2013]

Tax Rates for Water Pollution

Law on Natural Resources Tax
Annex 6

[15 December 2016; 26 April 2018]

Tax Rates for Goods Harmful to the Environment

1. Tax rates for goods harmful to the environment except for electrical and electronic equipment which are laid down in Section 1, Clause 22 of the Waste Management Law

2. Tax rates for electrical and electronic equipment which are laid down in Section 1, Clause 22 of the Waste Management Law by 30 June 2018

3. Tax rates for electrical and electronic equipment which are laid down in Section 1, Clause 22 of the Waste Management Law from 1 July 2018

Law On Natural Resources Tax
Annex 7

[6 November 2013; 25 September 2014; 23 November 2016; 15 December 2016; 26 April 2018 / Amendments to Clause 2 of Table of Annex in relation to the deletion of the words "oxy-degradable plastic" and the deletion of Clause 5 of Table shall come into force on 1 July 2018. See Paragraph 27 of Transitional Provisions]

Tax Rates for the Packaging of Goods and Products and for Disposable Tableware and Accessories

Law on Natural Resources Tax
Annex 8

[19 September 2013]

Tax Rates for Radioactive Substances

Law on Natural Resources Tax
Annex 9

[14 November 2019]

Tax Rates for Coal, Coke, and Lignite (Brown coal)

¹ The Parliament of the Republic of Latvia

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