2016

Forest machinery fuel to be controlled by LVM in collaboration with the SRS

JSC "Latvia's State Forests" (LVM) has launched cooperation with the State Revenue Service (SRS) to limit the use of duty-free fuel or fuel of unknown origin for logging and transportation of timber, as well as by the providers of road construction services.

Diesel fuel which is subject to an excise duty relief, in accordance with the effective Latvian legislation, may be used exclusively for the cultivation of agricultural land and manufacturing of products, for heating, as well as in other cases laid down in the Law on Excise Duties. Forest machines that perform logging works, ensure transportation to the stack, as well as carry out soil preparation works are not allowed to use such fuel. Therefore, LVM employees, if necessary involving SRS representatives, will carry out fuel control, sending samples for laboratory testing.

"Such inspections will significantly improve the situation of the fair service providers, because dishonest service providers who do not pay taxes to the state, offering services below the actual cost price, will no longer be able to win tenders. If a contractor does not pay the excise duty on fuel, losers in this situation are the honest entrepreneurs who cannot win the competition for employment, as well as all residents of Latvia whose access to quality health care, education, security, and similar services is directly dependent on the taxes paid to the state budget," says Roberts Strīpnieks, President of JSC "Latvia's State Forests".

Appreciating the LVM initiative to promote fair market competition, the SRS states that so far farmers and merchants who have been granted the right to purchase or supply marked diesel fuel, have been subjected to regular inspections. In cases where an administrative violation was detected, administrative proceedings have been started; in turn, in cases where there were violations of normative acts that affect the amount of excise duty, excise duty clarification is carried out.

LVM is a socially responsible company which manages the state property with the aim of maximising its owner's income from sustainable forest management. Each year LVM pays 90% of its profit in form of dividends to the state budget, supplementing the budget revenues with more than 40 million euros.