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2026 has reshaped the tax landscape across the Baltics, but not in the same way everywhere. Some systems remain unchanged, others introduce structural changes and several measures apply gradually throughout the year. Taxes in Baltic States in 2026 is a regional tax overview prepared by the Numeri Group, bringing together the key tax rules in force across Estonia, Latvia and Lithuania in 2026.

The Estonian Parliament adopted amendments to the Income Tax Act on 3 December 2025, which will be effective from 1 January 2026. According to these amendments, the tax rate of individual and corporate income tax will remain at 22%. Also, the general tax rate of individuals using entrepreneur account will not be increased.

The Estonian Parliament adopted amendments to the Motor Vehicle Tax Act on 12 November 2025, which retroactively grants an annual tax allowance of up to 100 euros per year for every child under 19 years old to the parent or guardian of that child, starting from the beginning of 2025, provided they are the owner or responsible user of at least one M1 or N1 category motor vehicle registered in the traffic register. The allowance will be received by parents with full custody of the child or by guardian individuals.

In Latvia, significant tax changes are being prepared, which will affect both companies and their owners, natural persons. The Ministry of Finance offers a new regulation that would balance the tax burden between local and foreign investors, while at the same time ensuring additional revenues for municipalities. If everything goes according to plan, the new model will enter into force on 1 January 2026 together with the state budget.

On 24 September 2025, the Estonian Government approved the state budget for 2026. According to the proposal, the income tax rate for both individuals and companies will remain at 22% and will not be increased to 24% as prescribes the law amendment adopted by the Estonian Parliament earlier on 18 June 2025. The Government also confirmed that the general tax rate for individuals using an entrepreneur account will not increase.

The EU and the US have agreed on a new tariff framework that aims to restore trade stability and avoid a looming escalation in duties. The deal offers predictability for businesses on both sides of the Atlantic at a time when global supply chains remain vulnerable and geopolitical tensions continue to reshape international commerce.

From 15 July to 6 August 2025, the EU has suspended retaliatory tariffs on US-made goods - originally imposed in response to US import duties on EU products. This pause is driven by renewed efforts to negotiate a trade resolution.

According to the Estonian income tax legislation, the fringe benefit taxation applies to loans granted below the fair market value interest rate to the employee or member of the board or council, except if the interest at the moment of the payment of interest is at least twofold of the interest rate of the European Central Bank applicable to the main refinancing operations. From 1 July 2025, the referred twofold amount of interest rate has decreased from 6,3% to 4,3%.

The Estonian Parliament adopted on 18 June 2025 further tax changes prepared by the Government, according to which the security tax will be abolished, but the VAT rate will still be raised to 24% from 1 July 2025 and the income tax rate will be increased also to 24% from 1 January 2026.