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  • Javier Vazquez

    Sharing our expat experiences in Riga was very helpful. Particularly when it comes to setting up your own business here.

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Employment in Latvia

Economic Overview

Since declaring itself independent after the collapse of the Soviet Union in 1991, Latvia has been transitioning to a market economy, and in the years leading up to the recession it had the fastest growing economy in the European Union. In 2014, Latvia’s total GDP of 48.59 billion USD, or 23,900 USD per capita, is split across three main economic sectors: services (70% of total GDP), industry (25%), and agriculture (5%).

Due to its location and geography, Latvia’s economy is heavily reliant on the production and processing of export products, including timber, electronic goods, machinery, and food products.

As a result Latvia has an excellent transportation infrastructure, which accounts for 14% of its GDP. It is a popular destination for expatriates, mainly due to its favorable tax laws and high ease-of-business ranking (23rd in the world).

Work Permits for Latvia

Whether or not you will need a permit to work in Latvia depends on your nationality. As it is a member of the European Union, EU nationals will not need a permit to work in Latvia. However, they will need to apply for a residence permit to stay for longer than the period of a tourist visa (90 days).

Non-EU nationals will need a work permit before they can begin legally working in Latvia. In order to obtain a work permit you must demonstrate proof of your prospective employment in Latvia with a registered Latvian business. In some cases you may also need to have already secured a long-term residency permit.

Exceptions are made, however, for shareholders in Latvian companies, foreign nationals with a permanent residency permit, and for managers of foreign companies representing a Latvian firm in the country.

Taxation in Latvia

In Latvia tax is levied by both federal and local governments and accounts for almost 30% of the country’s total GDP. Unlike most European countries that use a progressive sliding scale tax system, Latvia has a flat rate for income tax.

This means that whatever you earn whilst working in Latvia will be subject to 24% income tax, regardless of your total income. You are exempt from income tax up to 900 EUR per year and 1980 EUR per year for every dependent.

However, you will also be required to pay social security contributions on top of your income tax, which currently stand at a rate of 11%. Social security contributions are capped at 46,600 EUR of yearly income.

The Value Added Tax rate is set at 21%, but there is a lower rate of 12% for some items, such as heating and medications. Additionally, some products are not subject to VAT, including education, rent, and medical fees.

May 18, 2024, 6:30 PM
15 attendees
🌟 Join us for an unforgettable evening at InterNations Riga's May Event on the 18th of May, 2024, starting at 19:30! 🌟 Get ready to mingle and connect with current and former expats, foreigners vis
Apr 20, 2024, 6:00 PM
20 attendees
Celebrate the spirit of connection at our vibrant InterNations Socializing Event in AOK City Riga! Join us for an unforgettable evening of mingling, laughter, and cultural exchange in the heart of Rig
Mar 14, 2024, 5:30 PM
16 attendees
Let's dive into a night of continuous socializing, all within the inviting walls Blues House Riga one of the finest spots in Riga for lively social gatherings, the top destinations in Riga for fantas
Feb 15, 2024, 5:30 PM
13 attendees
Join us for a vibrant social gathering at A'Drop, Riga's premier cocktail bar, where we'll indulge in an evening of exquisite libations and lively conversations. Immerse yourself in the captivating a

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  • Javier Vazquez

    Sharing our expat experiences in Riga was very helpful. Particularly when it comes to setting up your own business here.

  • Michelle Guillemont

    The idea to conect expats worldwide is not only great, it really works. I met several French-speaking women within the first weeks.

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