Riga is starting to apply the increased real estate tax rate to objects not put into operation

More than 15,000 construction cases are registered in the Riga municipality and according to Cabinet of Ministers regulations no. 500 “General building regulations”, the maximum duration of construction works from the issuance of the building permit to the commissioning of the building is eight years. But for those building permits, in which the maximum period for carrying out construction works was not specified, the eight-year term is counted from October 1, 2014, when the “General Building Regulations” came into force, which means that the maximum period for carrying out construction works for these building permits expired on October 1, 2022.

Considering that due to various circumstances, construction works may be canceled, suspended, and prolonged, the municipality invites residents, companies and organizations to check the maximum duration of construction works specified in building permits. Because in cases where the construction is not completed within the specified period, the municipality has the right to apply the increased real estate tax in the amount of 3% of the cadastral value of the building or the land belonging to the building with the following month, according to the law “On real estate tax”.

Municipal building inspectors control construction cases as much as possible, but residents and entrepreneurs are invited to show their own initiative about their object even before the property is taxed with the increased real estate tax. Last year, 2,154 objects were identified for which the maximum duration of construction work specified in the building permit had expired. After receiving the warning, 1,050 objects were put into operation or building permits were cancelled. The owners of 836 objects started arranging construction cases or re-registration, while the increased real estate tax was applied to 268 objects.

Building permits for which the maximum duration of construction work has expired are found for various objects – private houses, apartments, buildings of public importance, cafes, etc. The most popular object is the attic, in which groups of rooms and apartments have been created, but which have not actually been put into operation. Most often, the building permit for these objects was issued more than 10 years ago, and when the owners change, the new ones are not informed that there is an active construction case in the object.

If the construction works have been completed in accordance with the construction project, the municipality invites the building object to be put into operation, while if the construction has not taken place, the building permit must be canceled. If the maximum duration of construction works has ended, but the construction is still planned, the municipality invites to extend it by attaching the documents specified in Clause 97 of the Building Construction Regulations to the application. In this case, the municipality will extend the term of the building permit to the time specified in the insurance policy. If the maximum duration of construction works has not yet come, then if necessary, it should be extended in time.

Before applying the increased real estate tax, the municipality checks whether there is any progress in the construction case, whether the owner of the object has not changed, and also, if necessary, conducts an in-person inspection of the construction objects. If the owner has not changed and there is no progress in the construction case for a long time, an increased real estate tax is applied to the object from the month following the municipal mark in the system. If the persons are active and interested in sorting out the construction matter, the municipality meets and does not apply the increased tax rate.

If the owners of the objects ignore the demands of the municipality, the municipality will use the right to prohibit the operation of the building, because according to the Law on Construction, it is forbidden to use the building until it is accepted for operation and the building accepted for operation is used only in accordance with the designed use. Violation of building regulations, i.e. see the use of a building, its part or a group of premises before commissioning is an administrative violation for which the relevant person is held administratively liable.

Residents, companies and organizations whose building permit has or is about to expire are invited to contact the City Development Department of Riga municipality. Additional information is available on the website www.rdpad.lvin the “Construction” section.