The Latvian government has approved draft budget measures for 2026, including the application of a reduced VAT rate of 12% on basic foods, including milk, bread, poultry meat, and eggs from 1 July 2026 to 30 June 2027. The government also approved a EUR 40 increase in the basic personal allowance and minimum monthly wage to EUR 550 and EUR 780, respectively, in 2026. Lastly, the government approved an increase in excise taxes on alcohol and tobacco starting in 2026.