Latvia Country Commercial Guide
Learn about the market conditions, opportunities, regulations, and business conditions in latvia, prepared by at U.S. Embassies worldwide by Commerce Department, State Department and other U.S. agencies’ professionals
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The Latvian economy is largely based on service industries, including transportation, information technology, and financial services. The construction industry also plays an important role, as do wood and forestry products, food processing, metalworking, and light industries (e.g. textiles). Tourism has almost fully recovered from the COVID-19 but continues to experience structural changes due to the Russia-Ukraine war.  

Latvia’s current corporate income tax (CIT) system has been in place since 2018. Latvia’s corporate tax structure exempts CIT on reinvested profits. The CIT rate on gross distributed profits is 20 percent but, after accounting for other mandatory payments, has an effective rate of 25 percent.  

The Latvian government is expected to spend about $12.3 billion (€10.5 billion) of EU structural funds in 2021-2027, which includes about $2.9 billion (€2.5 billion) Latvia will receive through the EU’s Recovery and Resilience Facility (RRF). The Latvian government provides several incentives for investment, including in the areas of taxes, labor, research and development, and state credit guarantees. Please see the Latvian Investment and Development Agency (LIAA)’s website for detailed information on the available incentives and tax allowances.  Detailed information on Latvia’s planned use of the RRF is available at the following address:  https://commission.europa.eu/business-economy-euro/economic-recovery/recovery-and-resilience-facility/latvias-recovery-and-resilience-plan_en 

The European Bank for Reconstruction and Development (EBRD) operates in Latvia out of its regional office in Vilnius, Lithuania. Latvia qualifies for U.S. Export Import Bank (ExIm) financed projects. The U.S. International Development Finance Corporation (DFC) is also able to support some energy projects in Latvia.  Nordic Investment Bank has operated its regional hub in Riga since August 2023.  

Opportunities exist for expanding trade in various sectors, including energy, IT, forestry, farming, woodworking equipment, transportation (including aviation), agricultural products, and defense. Latvia is part of the $17.6 billion (€15 billion) Rail Baltica greenfield rail transport infrastructure project that will connect Latvia, Lithuania, and Estonia with the European rail network. Latvia plans to complete the project by the end of 2030.  More details on the project are available at the following address:  https://www.railbaltica.org/  

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Global Business Navigator Chatbot Beta

Welcome to the Global Business Navigator, an artificial intelligence (AI) Chatbot from the International Trade Administration (ITA). This tool, currently in beta version testing, is designed to provide general information on the exporting process and the resources available to assist new and experienced U.S. exporters. The Chatbot, developed using Microsoft’s Azure AI services, is trained on ITA’s export-related content and aims to quickly get users the information they need. The Chatbot is intended to make the benefits of exporting more accessible by understanding non-expert language, idiomatic expressions, and foreign languages.

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As a beta product, the Chatbot is currently being tested and its responses may occasionally produce inaccurate or incomplete information. The Chatbot is trained to decline out of scope or inappropriate requests. The Chatbot’s knowledge is limited to the public information on the Export Solutions web pages of Trade.gov, which covers a wide range of topics on exporting. While it cannot provide responses specific to a company’s product or a specific foreign market, its reference pages will guide you to other relevant government resources and market research. Always double-check the Chatbot’s responses using the provided references or by visiting the Export Solutions web pages on Trade.gov. Do not use its responses as legal or professional advice. Inaccurate advice from the Chatbot would not be a defense to violating any export rules or regulations.

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