On Wednesday, March 10, the Legal Commission of the Saeima has supported the proposal to move towards the reduction of the “disproportionately high” state fee for the registration of specific cases of alienation of real estate in the Land Register.
The proposal of the deputy Gata Eglītis (JKP) envisages that the Cabinet of Ministers should amend the regulations on the state fee in connection with the consolidation of property rights in the Land Register. As the deputy explains, the proposal envisages to reduce the amount of the state fee for a natural person from the currently set 2% to 1.5% of the property value, while for a legal person to strengthen an apartment property from 6% to 2% of the property value.
More specifically, the proposal provides for a state fee of 1.5%
from the value of real estate for registration in the land register should be determined in relation to the alienation of land property or land and building property, or building property consisting of a dwelling house (including functionally related buildings and structures) to a natural person on the basis of a contract or court decision on approval of the auction deed or on the basis of a court decision regarding the consolidation of the real estate to the auctioneer, co-owner or creditor.
It is also proposed to attribute the respective state fee in the amount of 1.5% of the value of real estate to the alienation of land and building property or building property consisting only of a non-residential building or non-residential buildings and related engineering structures to a natural person on the basis of a contract or court decision on auction. approval of the deed or on the basis of a court decision regarding the consolidation of immovable property to the auctioneer, co-owner or creditor.
The relevant state fee of 2% of the value of the apartment property is intended to be applied to the alienation of the apartment property to a legal person engaged in commercial activities, on the basis of a contract or court decision on approval of the auction deed or on the basis of a court decision on securing real estate.
Eglītis’ proposal envisages that the amendments of the Cabinet of Ministers must enter into force no later than July 1, 2021.
This date can still be changed when the bill is considered in the final reading.
As explained by the deputy in the justification of the proposal, the current amounts of state fees for registration of property rights in the Land Register for alienation of property to a natural person and for alienation of apartment property to a legal person engaged in commercial activity are set disproportionately high.
According to the data of 2019, the projected decrease in fee income from such changes from the State Unified Computerized Land Register would be 6.42 million euros, including 2.14 million euros for fee reduction to 2% for registration of alienation of apartment property for legal entities and 4.28 million euros for the reduction of the fee to 1.5% for the registration of the alienation of property to natural persons, explains Eglītis.
The Chairman of the Legal Commission Juris Jurašs (JKP) pointed out that the Ministry of Finance will be expected to provide information on the impact of this proposal on the state budget.
The Saeima will still have to vote on this proposal.
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