MPs were approached by the European Latvian Union and told that people receiving retirement benefits in other EU states want to return home but may have to face paying double charges over their pensions, which have already been taxed abroad, MP Andrejs Judins of the Saeima committee of citizenship and migration affairs told Latvian Radio on February 8.
As a 23% income tax is levied on retirement benefits in Latvia, pensions are considered as income earned abroad and are thus taxed. For example, if a person receives retirement benefits in a country where the tax is lower than 23%, people have to pay the differential, said Ināra Kopase, a representative of the State Revenue Service.
"It's a serious matter if people don't come to Latvia in old age because they have to pay the tax," said Judins.
MPs say they'll contact the responsible institutions over the matter and potentially start tackling the problem.