Minister floats idea of funneling part of income tax to region of workplace

Coalition partners widely support the idea of funneling part of the income from the personal income tax to the municipality where someone is working in, Environment Minister Juris Pūce (Development/For!) said appearing on Latvian Radio's Krustpunktā show April 11.

"If just 20% would be funneled to the [municipality where] they are working in, it would bring radical changes to the municipalities' financial standing," said Pūce.

He also said that people often declare their official place of residence in municipalities where they are summering; meanwhile these municipalities accordingly give them breaks on real estate tax. 

Currently 20% of personal income tax goes to the state budget while the remaining 80% goes to the municipality where the person has declared their place of residence.

This can and often does mean, for example, that someone is working and residing in Rīga but their income tax is paid for, say, Ogre, where they have declared their place of residence.