Kariņš: changes needed in tax system in Latvia

The tax system should become more equitable and changes should take effect as of January 1, 2021, Prime Minister Krišjānis Kariņš said on June 10 after meeting with the President of the Bank of Latvia, Mārtiņš Kazāks.

Kariņš pointed out that in February, the government examined the information report prepared by the Ministry of Finance, which contained a broad overview of the impact of changes in individual taxes.

Kariņš said now that Latvia has ended the state of emergency, the coalition is paying more attention to changes in the tax system. He expressed hope that a more equitable and sustainable tax system could be established, as the COVID-19 crisis revealed a lack of alternative tax schemes.

"The result will depend on whether the five parties are willing to agree on changes," the Prime Minister said.

The President of the Bank of Latvia said that tax changes should not be forgotten, because COVID-19 has highlighted the issues. Kazāks pointed to existing tax schemes that do not protect citizens from potential crises and threaten retirement income.

According to Kazāks, it would be best to think about reducing the labor tax burden and not consumption taxes such as VAT.

 

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