This year tax revenues could be almost 8% higher than last year. However, from the point of view of public financial planning, the situation is not so good - the budget revenue will be lower than expected.
In the first six months of this year, tax revenues amounted to EUR 7.024 billion, which is EUR 32.7 million or 0.5% less than planned, the LETA news agency reported.
In the second half of the year, the tax contribution could fall short of the plan by EUR 70 million, Ašeradens said.
Explaining the reasons for this, the minister pointed to the European Central Bank, which, while sticking to higher interest rates, is continuing to fight inflation. "The whole system could be metaphorically called a refrigerator. How inflation is stopped - by reducing demand and thus cooling the economy. That fridge is still on," said Ašeradens.
He said that Latvia, unlike quite a large number of EU member states, had managed to avoid the excessive deficit procedure. "If a country's budget deficit exceeds three percent, then the country has to cut its costs over the next four years. Latvia has avoided this. To be absolutely clear, we are not in danger of this situation," said Ašeradens.
At the same time, Latvia's budget has negative or neutral fiscal space due to lower tax revenue forecasts. "Accordingly, the government and the prime minister have said that instead of the three priorities that we used to have - education, health, and security - the single most important priority remains - security. This is what we can afford," the Minister said.
