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Cobalt Successful for Bauer in Tax Dispute with Latvian State Revenue Service

Cobalt Successful for Bauer in Tax Dispute with Latvian State Revenue Service

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Cobalt has successfully represented Germany's Bauer Spezialtiefbau before the Administrative District Court in a dispute related to a VAT refund for the company against the State Revenue Service of Latvia.

According to Cobalt, on August 4, 2023, the Administrative District Court ruled in favor of Bauer and ordered the State Revenue Service to refund the value-added tax along with late payment interest of over EUR 300,000.

Bauer AG is a German construction and machinery manufacturing company.

"The dispute centered around the decision by the State Revenue Service that Bauer, as a taxpayer from another EU member state not conducting economic activity in Latvia, was not entitled to a tax refund for services received in Latvia from another registered taxable person associated with the construction of real estate," the firm reported.

The Administrative District Court, on the other hand, determined that Bauer had met the necessary conditions for entitlement to a VAT refund and that the State Revenue Service could not prevent Bauer from exercising this right simply because it was not registered in the VAT payer register in Latvia, according to Cobalt. "The court dismissed the State Revenue Service’s allegations regarding Bauer’s fixed establishment in Latvia. The State Revenue Service did not appeal the decision, which has now taken effect."

The Cobalt team included Partner Sandija Novicka, Specialist Counsel Sabine Vuskane, and Associate Gabriela Santare.

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