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Latvia's Saeima passes 10% voluntary crypto declaration, moves to investment-account tax model

Parliament adopted amendments on October 15 introducing a 10% one-time declaration on crypto held December 31, 2026, and taxing withdrawals above deposits rather than per-trade.

by 4 min read
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Latvia's Saeima adopted amendments to the Law on Personal Income Tax on Thursday, October 15, 2026, in a final reading recognized as urgent, introducing a one-time voluntary declaration mechanism for crypto assets at a 10% rate and shifting the ongoing taxation of crypto to an investment-account model modeled on the one already used for stocks and bonds. The reform was separately reported by CoinDesk, which notes that forward-looking plans — including crypto tax payments by 2027 — depend on the next government and payment-processor integration not yet completed.

What the law does

Two separate mechanisms, both inside the same amendment package.

One-time voluntary declaration. Residents may declare crypto assets they will hold on December 31, 2026 in accounts at EU-licensed crypto-asset service providers or in self-custodial addresses. Terms:

  • Rate: 10% on the declared assets' market value as of December 31, 2026.
  • Declaration window: April 1 to May 31, 2027.
  • Tax due by: July 23, 2027.
  • The declared market value becomes the acquisition cost for future tax calculations.

The rationale, per the Saeima rapporteurs cited by lvportals.lv, is that many Latvian residents acquired crypto before the tax framework was clear and lack reliable records of what they paid. The 10% settlement is a one-time path to a legal starting basis.

Investment-account regime going forward. Crypto trading inside a declared "investment account" is taxed on net withdrawals above net deposits, not on every individual trade. The same account model already exists for securities. The amendment allows EU-licensed crypto-asset service providers to offer these investment-account services.

Numbers block

- One-time declaration rate: 10% of market value on 2026-12-31
- Declaration window:        2027-04-01 to 2027-05-31
- Payment deadline:          2027-07-23
- Investment-account tax:    on withdrawals net of deposits
- Service providers:         EU-licensed CASPs

Why this matters inside the EU framework

Automatic exchange of information on crypto transactions and accounts has applied in the EU since 2026 under the extensions of DAC8. Latvia's declaration mechanism gives residents a window to regularize holdings ahead of the full data-exchange cycle. The investment-account regime is also a structural change: by removing the per-trade taxable event, it brings crypto in line with how Latvian tax law already treats listed securities.

CoinDesk's reporting adds a forward-looking element not in the law itself: adviser Didzis Dejus said crypto could be used to pay taxes starting in 2027, pending integration with a payment provider and decisions from the next government — Prime Minister Andris Kulbergs's United List won the October 3 parliamentary election and must still form a coalition. That piece is intent, not statute.

What to watch

  1. The implementing regulations. The amendments set the rate and timing. Service-provider onboarding rules, reporting formats, and the treatment of DeFi balances will come through secondary regulation ahead of April 2027.
  2. Coalition composition. The next government decides whether to extend the declaration window, add tokenized assets, or launch the payment-processor integration Dejus flagged.
  3. CASP registrations. The investment-account regime requires EU-licensed crypto-asset service providers. The list of MiCA-authorized CASPs that opt to offer Latvian investment accounts will shape who residents can custody with and still receive the regime's treatment.
  4. Enforcement scope. The law covers self-custodial addresses, but enforcement there relies on voluntary declaration. The declared-value basis becomes the only reliable cost reference for future audits.

Context

Latvia is working within a wider EU pattern of consolidating pre-MiCA crypto holdings into declared, taxable positions ahead of DAC8-era information sharing. France's PLF 2027 amendments — the stablecoin-conversion taxation debate and the wallet-declaration threshold at €100,000 — go the other direction, tightening the base rather than offering a one-time clean-up. Latvia's approach of a settlement rate plus an investment-account model is closer to the way several EU states have treated securities for a decade. It is the first time an EU parliament has formally offered a one-time crypto declaration rate inside a personal-income-tax amendment.

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