The tax liability in Latvia for late tax payments of a legal person
On 15 November 2016 the Constitutional Court passed the judgement in Case No. 2015‑25‑01 “On Compliance of Section 60, Section 61 and Section 62 of the Law on Taxes in Latvia and Fees with the First Sentence of Article 91, Article 92 and Article 105 of the Satversme of the Republic of Latvia”.
A member of the board should act as an honest and careful manager to perform the duty of paying taxes in public interests
On restriction upon the right to own property for tax liability in Latvia
The Constitutional Court found that the contested norms did not restrict the property right of legal persons and those of the founders thereof, but norms did restrict the property rights of the board member of a legal person as a natural person.
On the right to a fair trial for tax liability in Latvia
The Constitutional Court recognised that the contested norms applied, if the board member has not duly performed his obligations defined by law. An obligation may be imposed upon the board member to repay the late tax payments of the legal person from his own personal resources, and that would include the basic sum of the debt, and also penalty payments and late payment fees.
The Constitutional Court recognised that the compliance with the principle of the presumption of innocence had to be examined, since contested norms pertained to the scope of the second sentence of Article 92 of the Satversme.
On the principle of equality for tax liability in Latvia
The Constitutional Court recognised the contested norms as being compatible with the principle of equality included in the first sentence of Article 91 of the Satversme. The Court noted, a person should always act in a way to perform the obligation of paying taxes in public interests.
The Constitutional Court recognised the contested norms as being compatible with the first sentence of Article 91, Article 92 and Article 105 of the Satversme.
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