Policeman and business owner arrested over paying non-taxed wages

Take note – story published 6 years ago

For the first time a person has been arrested in Latvia for paying non-taxed wages in cash. The case, which also saw the arrest of a now former policeman, follows a story aired in March by LTV's Forbidden Method over a security company that evaded paying taxes for its salaries. 

In the story, Edgars Mētra, the owner of the small security firm Verge, was seen paying wages in cash with the actions documented on film by one of his employees.

Imants, the employee that turned to Forbidden Method said that upon paying wages Mētra, a former policeman, had produced an assistant badge to threaten employees against giving away his unscrupulous business practices.

This had been what pushed Imants to turn to Forbidden Method and document the way wages are paid at the company.

The story revealed that upon starting work Imants had been advised he'd actually be paid just €0.90 an hour under a contract that actually stipulates he'd receive €2.70 an hour. In turn, the employer was able to evade paying social security tax. 

Journalists from Forbidden Method handed all the materials they had to the police after airing the show. 

In August the Finance Police department carried out 23 searches, with Mētra and a policeman arrested. This is the first legal precedent in Latvia of someone being arrested over paying wages in cash. 

The second detainee is a high-ranking police officer Rolands Strauts who was fired in July. According to information by Forbidden Methods, he was the one organizing the tax evasion schemes. 

Last year the Latvian parliament introduced stricter punishment for tax evasion by way of paying wages in cash. The crime now carries up to two years imprisonment. 

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