How can Latvia be attractive to foreigners who have chosen this small Baltic country for life and business? Many ports in the Baltic Sea, a convenient railway system and road junctions, and developed air traffic allow maintaining contact with Western and Eastern countries. Latvia annually enters the ratings of the best states for doing business. This is not surprising, because in Latvia there are no restrictions for companies, investors, and startups from other countries. In the last 2 years alone, 50% of new companies were registered in Latvia by representatives of the countries of Europe, America, and the CIS.
Most of the business in Latvia is concentrated in the fields of tourism and hospitality, computer technology, pharmaceuticals, woodworking, fishing and rural industries, construction, and mechanical engineering. Foreign businessmen in Latvia most often open hotels, fitness centers, beauty salons, and restaurants, and build residential and office buildings. But tourism remains the most profitable type of activity, accounting for about 70% of the country’s GDP.
Pros and cons of doing business
The state provides effective support to all foreign businessmen who decide to open a company in Latvia, this is one of the main advantages. In addition, the following circumstances are very important:
- Opening a representative office or registering a company is easy and inexpensive. The easiest way is to open an LLC. For this, it is required to draw up the articles of association and draw up contracts. To register a company, you will need to present the authorized capital, its amount can be equal to one euro. The maximum amount of the authorized capital for registration is 2,799 euros.
- Both a resident and a non-resident can open a business in Latvia. At the same time, non-citizens of the country have the opportunity to issue a residence permit for themselves and their families.
- Latvia is part of NATO and the Schengen area. Accordingly, every person who starts his own business here becomes a European businessman and goes to a completely different level.
The benefits also include:
- Uncomplicated accounting system.
- The lowest taxes in Europe – 15%. At the same time, the exact amount of business tax depends on indicators such as its specificity and type.
- The ability to use the services of public and private institutions. So, thanks to the effectively developed banking system, businessmen have access to lending, and the ability to use various financial services of any level.
The disadvantages include the following features: all documentation is issued here only in Latvian, so the entrepreneur has to translate it into his own language and notarize it. In addition, the full share capital must be produced before the formation of the company.
As for tax reporting, it must be submitted to the local state revenue service monthly, quarterly, or annually, depending on the type and characteristics of the business.
What types of businesses are popular with expats?
Citizens from the CIS countries prefer to work in several areas of small business in Latvia. These areas are a public business, work with real estate, the provision of transport services, everything related to health, etc.
It is very popular here that is related to the tourism business because the country has everything that travelers and vacationers are interested in:
- Unique old castles.
- Excellent health resorts.
- Wonderful beaches of the Baltic coast.
- Developed infrastructure.
Beauty salons, cosmetology centers, and massage parlors are always in demand and represent another direction for starting and developing your business in Latvia.
The following areas are also in great demand:
- Building.
- Information Technology.
- Logistics.
- Agricultural activities.
- Renting out of the housing.
- Innovative technologies.
The woodworking industry is very popular in Latvia. Wood resources are abundant in the country, which can be used for the manufacture of office and home furniture and many other products for interior decoration and facades.
The woodworking industry in Latvia
In 2021, individual residential and commercial construction began to actively develop in Latvia. For most locals, this area is a priority for investing in finance.
According to statistics, foreign citizens opened more than 2.6 thousand companies in Latvia. A fifth of them belongs to immigrants from the former USSR, including Russian citizens.
Today it is becoming popular not to open, but to acquire a ready-made company, which is much easier and faster.
Foreigners buy construction, woodworking companies, as well as firms engaged in the food industry, banking or hotel business, and transport.
