“We aim at making our people wealthier. Joint efforts should result in the assistance provided in the developing middle class because it is the basis for a stable and democratic country,” outlined Raimonds Vējonis.
The President of Latvia pointed out during the conversation with the Minister of Finance that drafting the guidelines of taxation policy was a priority task of the government to be completed by this April. During the development process, hearing the opinions of Latvia’s entrepreneurs and experts and assessment of the recommendations provided by international institutions were expedient.
Raimonds Vējonis called on the Minister of Finance to consider the use of energy tax while forming the taxation policy that would enable reduction of labour taxes by strengthening Latvia as an energy-efficient, environmentally sound, and climate-friendly economy. The Energy Security Commission established by the President of Latvia have concluded that less energy-intensive economies develop fast in the world. While urbanisation continues creating preconditions for a more efficient organisation of economic life and improvement of energy efficiency, environmental taxes have been used more and more in the world to achieve the climate targets.
The President of Latvia criticised previous actions aimed at reduction of the shadow economy. Raimonds Vējonis urged the Minister of Finance to combat backdoor salaries, unreported income, and VAT fraud schemes more intensely. According to the experts, the shadow economy accounted for 21.3% of GDP in the country in 2016 being higher than in the neighbouring countries, Estonia and Lithuania.
While discussing the development and adoption of the state budget 2017, the President of Latvia encouraged the Minister to offer more solutions enabling the MPs to engage in the budgeting process at an earlier stage. That would make the budget procedure more transparent allowing a timely review and discussion of the ideas and suggestions regarding the state budget spending and improving the quality of the budget-related draft laws.
At the end of the meeting, Raimonds Vējonis stressed that, following his advice, the review of the state budget spending should be continued during the budgeting process for FY 2018 and the opportunities to eliminate extravagant and unnecessary expenditure should be identified.
