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Sunday 24.06.2018 | Name days: Jānis
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BNN summary of the week: Latvia’s 2018 budget, Vaškevičs in Austria, and coalition talks in Germany

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Baltic news, News from Latvia, BNN.LV, BNN-NEWS.COM, BNN-NEWS.RUBNN offers a summary of this week’s topical news in a variety of categories: Fight; Business; Decline; Change; Growth; Future and Opinion.

CHANGE: Saeima approves next year’s budget; more funding for health and defence

On Thursday, 23 November, the Saeima approved Latvia’s budget for 2018. Next year’s budget revenue is planned at EUR 8.75 billion, whereas expenditures are planned at EUR 8.95 billion. The largest increase of funding is planned for healthcare. Latvia’s defence budget is set to reach 2% of GDP.

The budget was supported by 59 deputies. 37 members of the parliament voted against.

The Saeima started reviewing laws associated with the budget on Wednesday and continued reviewing them today. Politicians had previously agreed that budget talks would not continue late in the evening.

Forming the budget, politicians were committed to drop the so-called deputy quotas. They also agreed that no additional funding would be allocated for parliamentarians’ proposals. The Saeima stuck to this promise and supported only a couple of proposals on allocation of additional funding. Requests submitted for the budget suggested allocation of additional finances worth EUR 223 million. However, nearly all proposals were declined in the end.

Among deputies’ supported proposals is the allocation of EUR 2.4 million to boarding schools. Deputies also supported the proposal for allocation of EUR 302,250 from the budget for emergencies to higher education to match growth of social fees.

Full article here

FIGHT: Vaškevičs feels «harsh but fair» attitude from court justice system in Austria

Former deputy director of Latvia’s State Revenue Service Vladimirs Vaškevičs, who is accused of bribery and whose extradition from Austria has been a priority for Latvian authorities for some time now, says he feels «harsh but, thank God, fair» attitude from the Austrian court justice system.

In his interview to Neatkarīga, he was asked just how safe and stable he feels in Austria. The former official said «only dead men can feel calm and stable in this world, and even that is questionable».

Vaškevičs did not reveal his plans for the future. He only said that the most important thing is «what you have now. And right now I am undergoing medical treatment and studies.»

«Forgiving a murderer – it is the greatest human virtue. It is unimaginably hard. I don’t know if I can do that. Now they are in a better situation: they live, they have power, they drink and they are merry in their homeland. And it seems to me they are completely oblivious that conscience can and will definitely force a person to pay for what they have done. It is a law of life – it works without question and without mercy. I wish them to understand this law. But as for my good name, I have it and no one can take it away from me,» said Vaškevičs.

Full article here

DECLINE: Lengthy German coalition talks collapse

The German political parties that entered the country’s federal parliament after elections in September, still cannot reach an agreement on making a coalition and a majority government, but German Chancellor Angela Merkel has evaluated that new elections would be better than a minority government.

British public broadcaster BBC reports that on Sunday, November 20, the Free Democratic Party liberals left the coalition talks with Mrs Merkel’s Christian democratic bloc and the Greens.

Full article here

FUTURE: Talks commence on restoring ferry traffic between Ventspils and Saaremaa

On Wednesday, 22 November, a delegation from Saaremaa municipality arrived at Vetnspils Freeport to discuss with representatives of Ventspils municipality and freeport the proposal to restore ferry traffic between Saaremaa and Ventspils.

It should be added that even though ten years have passed since the closure of Ventspils – Mintu (Saaremaa), both Estonian and Latvian sides still remember this ferry line. In addition, representatives of both municipalities have received many questions from residents about the possibility of restoring this ferry line.

Ventspils Freeport says that the freeport’s authority with Ventspils City Council deputy chairman Jānis Vītoliņš, Ventspils Freeport CEO Imants Sarmulis and Marketing and Development Office manager Igors Udodovs met with Saaremaa municipality representative and Mintu port CEO Mihkel Undrest and Saaremaa municipality’s attracted researchers Aado Keskpaik and Juri Sakkeus. Guests explained Saaremaa municipality’s position, saying that restoration of the ferry line is very important.

Full article here

BUSINESS: lost Russian cargoes have cost Latvia nearly 50 million in nine months

Latvia’s economy has lost nearly EUR 50 million in nine months because of missed Russian transit cargoes. While Russian Railway had approved 90% of oil and coal cargoes for transit through Ventspils port at the beginning of the year, this amount had declined to a mere 5% by September, says Baltic Association – Transport and Logistics President Inga Antāne.

I should be said that BATL has spent the last couple of years asking Transport Ministry and the government to act in order to reduce risks for the economy and employment created by Russian government’s strategic decision to divert cargoes to its own ports. It should be added that transit is the second largest sector of Latvia’s national economy.

BATL President comments: «Day to day statistics are becoming more and more grim and only serves to emphasize the true changes in the transit sector. In the current situation the one to make quick and strategically sound decisions is the winner. The first piece of homework is improving Latvia’s competitiveness. This means dropping the plan to increase railway infrastructure fees next year, which would make Latvia a leader among EU member states in terms of size of railway fees.»

She continues: «If we cannot reach a compromise with Russia for preservation of transit volumes, we have to do all we can to make Latvia’s transit sector, including railway, more attractive to other regions. Unfortunately, our cooperation with Belarus and other countries points out just how non-competitive we are in this area.»

Full article here

GROWTH: taxes for business in Latvia – the most attractive among Baltic States

Latvia’s tax system is the most attractive among Baltic States and 13th most attractive among 190 countries of the world, according to the latest study performed by the World Bank and PricewaterhouseCoopers on tax systems around the world.

Estonia is ranked 14th and Lithuania is ranked 18th in the Paying Taxes 2018 rating.

It is mentioned in the rating that the general tax rate in Latvia is 35.9%. The time spent in Latvia paying taxes is 169 hours. The total number of tax payments in Latvia is seven. The tax rate in Estonia is 48.7%, the time spent paying taxes is 50 hours, and there are eight tax payments in total. The tax rate for businesses in Lithuania is 42.7%, time spent paying taxes is 109 hours, and there are eleven tax payments in total.

The average EU and EFTA tax rate is 39.6%, the time it takes for taxes to be administered is 161 hours, and the total number of tax payments is twelve. The average tax rate for companies in the world is 40.5%, the time it takes for taxes to be administered and processed is 240 hours, and a total of twenty four payments are required.

The most attractive tax system, according to authors of the study, is Qatar, followed by United Arab Emirates, Hong Kong, Iceland, Bahrain, Kuwait, Singapore, Denmark, New Zealand and Mauritania.

Full article here

OPINION: Ušakovs offers unhealthy policy, Harmony is used as Lembergs’ «satellite party»

«Cooperation between Harmony and Aivars Lembergs’ Union of Greens and Farmers has always existed. It existed even before Harmony first appeared in Riga City Council. The situation is the same in the Saeima, even though Harmony is in the opposition. Still, in situations when one or the other matter important to Lembergs appears, one does not have to be a great politologist to notice the ties between those parties. Other times it seems like Harmony is being used as Lembergs’ satellite party,» said former Harmony member, financier and owner of Laika stars business Vadims Jerošenko.

«The policy realized by Harmony on the inside by Nils Ušakovs is absolutely unhealthy. Right now it is beneficial for the party to be in opposition,» says Jerošenko.

He predicts that if, for some reason, Harmony forms a coalition with UGF during Saeima elections in 2018, it will be hard for Harmony to take on that kind of responsibility, because the party is not used to it.

Still, Jerošenko leans more towards the thought that UGF will not form a coalition with Harmony . «It could happen if several smaller parties make it to the Saeima. UGF’s first attempt at cooperation in the Saeima will be with the National Alliance,» he predicts. «If any of the right-wing parties manage to get a large number of deputies in the Saeima, UGF may try to form a coalition with them. But if that fails, UGF may consider forming a coalition with Harmony.»

Full article here

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SRS uncovers numerous violations more than half of inspected companies

State Revenue Service’s Tax Control Office performed a total of 305 thematic inspections of employers in Latvia in Q1 2018. Authorities recorded violations in 171 inspections, according to information from SRS.

Third level pension plan deposit volumes reach new record value

Residents’ interest for pension savings remains high. The volume of deposits made to private pension funds in the first three months of 2018 has reached a new historic peak: a total of EUR 16.5 million has been paid to 3rd level pension accounts, which is 11.6% more when compared to the same period of 2017, as reported by Finance and Capital Market Commission.

Petrol station network in Latvia caught performing fraudulent activities with diesel fuel

State Revenue Service’s Tax and Customs Police have uncovered and put an end to a fraudulent scheme with diesel fuel performed by some network of petrol stations in Latvia, as confirmed by the service.

Kaimiņš: I believe CPCB is performing a political order

In the evening of Thursday, 21 June, Corruption Prevention and Combating Bureau released three people previously detained as part of a criminal process regarding possible illegal funding of KPV LV party – Saeima deputy Artuss Kaimiņš, his colleague Atis Zakatistovs, and businessman Viesturs Tamužs.

Latvia’s parliament conceptually supports new sanction regulations

On Thursday, 21 June, Saeima supported in the final reading amendments to the Law on International Sanctions and National Sanctions of the Republic of Latvia that are meant to improve sanction regime regulations to ensure efficient application of national and international sanctions, as reported by Saeima press-service.

Storm in Tallinn floods streets, cuts Croatia-Argentina match short on TV

A rain storm has hit northern Estonia on Thursday, flooding some streets in the capital Tallinn, damaged buildings and badly affected the broadcast of an interesting World Cup game.

American banks tested for financial stress show positive results

The U.S. has performed banking stress tests and found that the 35 largest banks operating in the country have enough funds on hand to sail safely through a severe financial crisis.

Saeima fires judge for coming to work in a drunken state

On Thursday, 21 June, Latvia’s parliament supported the proposal to dismiss Rezekne Court judge Arvis Garais from his post. 71 deputies voted in favour, no one abstained and no one voted against.

UK to have three requirements to EU citizens willing to remain in UK

For citizens of the European Union willing to continue living in the UK after the country leaves the bloc, they will have to submit applications and answer three key questions over the internet, according to the country's interior minister.

Weather in Latvia to be rainy and cool during Ligo; next week’s weather to be dry and hot

Weather at the end of the week in Latvia will be dictated by a cyclone. Because of that, there will be instances of rain on Ligo. Weather is expected to improve next week, however, according to Latvia’s State Environment, Geology and Meteorology Centre.

Lithuania’s blood plasma corruption scandal extends to Latvia

The former head of Lithuania‘s National Blood Centre, suspected of corruption and involvement in unlicenced activity, received more bad news this week from Latvia, where investigators of the Lithuanian Special Investigation Service had questioned the Latvian Health minister, Anda Čakša.

Administrative burden to be reduced for foreign students and researchers

The administrative burden will be reduced for foreign students and researchers, as well as all education and research institutions hosting them. This is provided by the amendments to the Immigration Law approved by the Saeima in the third reading on Thursday, 21 June.

Latvian Economy Minister endures no-confidence vote

Saeima declined opposition deputies’ request for dismissal of Economy Minister Arvils Ašeradens.

Swedbank economist becomes new member of Bank of Latvia Council

On Thursday, 21 June, Latvia’s Saeima approved Mārtiņš Kazāks in his new post as member of Bank of Latvia Council, as confirmed by Saeima’s press-service.

Pope Francis’ visit to Latvia will be a national holiday

Latvia’s parliament has approved in the final reading a law that makes 24 September – the day Pope Francis plans to visit Latvia – a national holiday.

ICT specialist numbers in Latvia are below Europe’s average level

In Latvia, information and communication technology specialists form only 2.2% of all employed people in the country, which is considerably below the average level in the European Union – 3.7%. Romania and Greece are the only two EU member states in which the number of ICT specialists is below Latvia’s, according to European Commission’s DESI index.

Hungary adopts prison sentence for helping migrants

Hungarian National Assembly has passed a set of laws criminalising with prison terms some help provided to illegal immigrants by non-governmental organisations.

Harmony plans turning to Constitutional Court to prevent transition to Latvian language in schools

«Why should this reform stay unrealized? It is because schools are not prepared for cardinal changes coming from dozens of other reforms that have already shocked the country’s entire general education system,» says chairman of National Minority School Parents Forum and member of Harmony’s work group in Konstantīns Čekušins.

Deputies detained in KPV LV criminal case not declared suspects yet

Saeima deputy Artuss Kaimiņš and businessman Viesturs Tamužs detained in the criminal process regarding possibly illegal funding of KPV LV party have not yet been declared suspects. Both are currently in police custody. It is likely Kaimiņš will be released later today, 21 June.

Production of mines and grenades planned in Estonia

As the Estonian parliament has adopted new rules on military arms and ammunition production in the country, local defence firm Eesti Arsenal has voiced its plan to build a factory in Estonia to make military explosives.

Total tax debts in Latvia reached EUR 1.224 billion in June

At the beginning of June, total tax debts in Latvia, including topical, halted debts and extended repayment terms were equal to EUR 1.233 billion, which is 0.6% less compared to May, as reported by State Revenue Service.

Switch off internet nationwide during exams – Algerian approach

In an attempt to prevent cheating during secondary school exams, the north African nation Algeria, has turned off internet in its whole territory.

Control Service proposes kicking out shell companies as intensely as offshore companies

Shell companies in Latvia should be combated with the same intensity once shown to offshore companies, says chief of Anti-Money Laundering Service Ilze Znotiņa.

EU imposes tariffs on blue jeans, motorcycles and other U.S. export goods

The European Union will introduce retaliatory tariffs against U.S. exports on Friday, EU Trade Commissioner has stated a top official has stated in the bloc's reaction to Washington imposing steep duties on steel and aluminium earlier in June.

Latvia’s Saeima proposes improving job-combining rules for state officials

On Wednesday, 20 June, Latvian parliament’s Public Administration and Local Government Committee decided to submit for review amendments to the Law on Prevention of Conflict of Interest in Activities of Public Officials.

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