bnn.lv Latviski   bnn-news.com English   bnn-news.ru По-русски
Monday 27.03.2017 | Name days: Tālrīts, Gustavs, Gusts
LatviaLatvia

Economic Diary of Latvia. Sanctions, taxes and keeping promises

FaceBook
Twitter
Draugiem
print
(No Ratings Yet)

Baltic news, News from Latvia, BNN.LV, BNN-NEWS.COM, BNN-NEWS.RUThis week is notable mostly because of a preliminary piece of news that Russia may decide to lift its embargo on imports of fish products in Latvia in the next two weeks.

This piece of information came as a result of a visit by Latvian Agriculture Minister Janis Duklavs and Director General of Latvian Food and Veterinary Service Maris Balodis to Moscow. Latvian officials, met with Russian Agriculture Minister Aleksandr Tkachev in order to discuss ways of resolving the sanction war aimed at Latvian fish processing companies.

After the talks, Janis Duklavs announced the discussion was constructive. The two sides agreed that Latvia will provide Russian supervisory authorities additional information, including translated versions of some of the previously sent documents. According to the minister, Russian colleagues have promised to review the information quickly. If need be, Russian officials will ask additional questions to companies in which violations have been found. Once the Russian side receives the necessary information from Latvia and reviews it, it will be possible to discuss the matter of lifting the temporary ban on imports of Latvian canned fish products, said Duklavs.

Practically on the same day of Duklavs making this announcement, Aleksandr Tkachev said that Russia is prepared to lift the ban on Latvian fish products in two weeks’ time – after a detailed review of received information. «If no violations are noted, restrictions will be lifted,» – said Tkachev.

As previously reported, the ban on imports of Latvian and Estonian fish products was established by Russia on 4 June 2015. The reason for this embargo was Rosselhaznadzor’s uncovered systematic violations in the labeling of fish products and exceeded levels of benzopyrene concentration.

With a delay to the plan

According to the head of Latvian State Revenue Service Inara Petersone, Russian sanctions aimed at products imported from Europe have impacted tax administration in Latvia. This can potentially delay talks in regard to the country’s next year’s budget.

According to SRS’ report for the first half-year of 2015, tax administration is currently below expectations. The state treasury was expected to raise EUR 4.08 billion in the first seven months of 2015. In reality, only EUR 4.05 billion have been collected in the aforementioned period.

VAT administration was previously planned at EIR 1.1 billion. In reality SRS has managed to collect only EUR 1.07 billion. Nevertheless, compared with the first seven months of 2014, VAT administration has grown by 3.8%.

Corporate Income Tax administration is currently at EUR 222.57 million, which is 5.2% more in comparison with the year before, but still EUR 4.95 million below the plan. Social insurance fees for the first seven months of 2015 are behind the plan by EUR 3.66 million (at EUR 1.35 billion). Non-tax administration is EUR 8.18 million behind the plan (at EUR 246.23 million).

PIT is actually ahead of the plan – EUR 822.94 million in comparison with EUR 822.1 million. Excise tax amount is currently at EUR 445.56 million as opposed to the originally planned EUR 433.81 million, as reported by SRS.

Internal and external security, education and medicine – some of the most expensive fields – will be the main priorities of next year’s budget. The first meeting of the coalition work group for the development of the budget for 2015 was held this week. According to Finance Minister Janis Reirs, the budget will be based on expectations that GDP will turn out 3%, deficit will not exceed 1% and consumer prices will grow 2%.

Banks fail to keep their word

In a state of sanction war, declines in collected taxes and the necessity to invest more and more money into defence and security, the matter related to the role of credit institutions in the development of national economy has been put up for discussion.

As reported by Economy Minister Dana Reizniece-Ozola, coalition parties plan to discuss the situation with the allocation of loans. On 7 August, partners of the coalition plan to listen to the report of the Finance and Capital Market Commission and governors of the largest banks about trends in loans of households and the commercial sector.

Previously, the minister had landed criticisms on banks, saying that their policy hinders economic growth. She described their policy as very poor.

Reizniece-Ozola reminded that while the Saeima was discussing the adoption of ‘left keys’ principle in mortgage loan services, banks were actively calling for a refusal of such changes, promising to renew lending services. Now it seems that politicians have kept their word and banks have not.

Ref: 017.109.109.2624


Leave a reply

EC develops stricter requirements for EU competition institutions

The European Commission invites member states to provide competition institutions with resources, independence and effective authority, as BNN was informed by Competition Council.

Tallinn Airport summer schedule to contain 36 routes

Tallinn Airport has announced its summer schedule that will include direct flights to 36 destinations and take effect from mid-April to late May depending on the airline.

«Elf» movement created to oppose internet «trolls»

«While the internet is the leading platform for topical news, it is also an environment for intentional disinformation and lies,» says researcher of the Eastern European Policy Study Centre Maris Cepuritis.

Construction costs in Latvia up 0.8% in February

Compared to January, the level of construction costs in Latvia increased by 0.2 % in February 2017. Labour remuneration of workers rose by 0.8 %, prices of building materials as well as maintenance and operational costs of machinery and equipment grew by 0.1 %.

Pärnu property sold for building plywood plant

Finnish capital company Metsä Wood Eesti has bought 104,000 square metres of land with plans to construct a 50 million euro plywood factory that would employ 200 workers.

Green farmer Krauze does not agree that circus animals have earned «freedom»

«When we were fighting for our freedom, I never would have imagined that we would start closing different circuses, because they present historical and cultural values. I believe we should not restrict that on a legislative level. If any circus owner wants to do that, they can. But we should not establish such restrictions on a national level,» said Armands Krauze, member of the Union of Greens and Farmers.

Providus/Delna notice major risks in approval of KNAB chief’s retirement pension

Saeima’s decision to support amendments to the Law on Retirement Pension of the Chief of Corruption Prevention and Combating Bureau has signs of state take-over, as stated by Providus and Delna in their Saeima work monitoring report for February 2017.

Programme: new TV3 and LNT owner will likely sell channels to someone else

The next owner of TV3 and LNT television channels, American Providence Equity Partners investment company, will likely sell these channels to someone else after some time, as concluded by De Facto programme of LTV.

Opinion: multi-speed development idea in Europe is not in Latvia’s interests

The idea of having a multi-speed Europe, as described in the Rome declaration signed by EU member states, does not comply with Latvia’s interests, says president of European Movement – Latvia Andris Gobins.

European Regional Development Fund allocates 15 million euros for start-up ideas in Latvia

For the first time in Latvia, Altum development financial institution has announced a search for acceleration fund managers. These funds will allocate so-called smart money for the realization of different business ideas in their early stages of development. Businessmen will be able to receive up to EUR 250,000 to realize their ideas.

Navalny detained as series of anti-corruption protests held across Russia

The leading Russian opposition activist Alexey Navalny has been detained in Moscow as series of anti-corruption protests were held across Russia.

Hundreds of protesters arrested in Belarus after mass protests

Several hundred people in Belarus have been arrested after participating in mass protests in Minsk and other cities.

Latvia to experience contrasting weather conditions this week

Major weather contrasts of the weather in Latvia are expected to take place in the last week of March – rainy and chilly weather will be replaced by significantly warmer weather at the end of the week, as reported by the State Environment, Geology and Meteorology Centre.

Week in Lithuania. Foreign minister dismisses Lukashenko's accusations as fiction

Lithuania's Foreign Minister Linas Linkevičius has dismissed the statement by Belarusian President Alexander Lukashenko about training of armed provokers in Lithuania as fiction out of the blue.

BNN summary of the week: 5G in Latvia, fight against Lembergs, foreign trade balance deficit

BNN offers a summary of this week’s topical news in a variety of categories: Change; Business; Fight; Decline and Growth.

CC: restoration of trust – way out for cartel participants

This year, Competition Council provided positive conclusion in regards to recovery of trust to two companies previously punished for cartel agreement.

Kristovskis: coalition with Lembergs in Ventspils City Council is not possible

«If the party’s list enters the city council, our candidates will definitely not work with Lembergs,» said Girts Valdis Kristovskis in an interview to Latvijas Radio.

Sadales tīkls: energy industry enjoys stable growth in Baltics

Although the company does not experience the lack of quality labour force, when announcing vacancies it becomes clear that population density in regions continues to decline, and this makes it harder to find young specialists for work in regions, said Andis Pinkulis, CEO of Sadales tīkls, in an interview to BNN.

Airline Nordica not to ban tablets and lap-tops from being brought on passenger cabin

Estonia’s national airline Nordica has stated it would not follow the recent U.S. and British ban on such computer devices as tablets and lap-tops from being brought onto passenger cabin on flights.

Rinkevics invites Canadian companies to use Latvia’s transit and logistics infrastructure

«We’re hoping for more intensive economic cooperation and diversification of exports of Latvian goods, as well as attraction of investments from Canada. Canadian investors are awaited in Latvia,» says Latvian Foreign Affairs Minister Edgars Rinkevics.

Rimsevics: tax changes may increase lending volumes in Latvia

Lending volumes in Latvia may increase because of changes to the country’s tax system, says governor of the Bank of Latvia Ilmars Rimsevics.

Latvian authorities deport 19 Vietnamese citizens

19 Vietnamese citizens caught trying to cross the border of the Republic of Latvia last year have been deported from the country.

Latvia’s export and import volume was the lowest in January

Latvia’s export and import volume this January was below what was noted in Lithuania and Estonia. The largest foreign trade balance deficit among Baltic States was noted in Estonia.

Lithuanian population continues to shrink, some glint may be ahead

The shrinkage of Lithuanian population is nowhere close to a halt. In fact, the recent numbers by the Lithuanian Statistics and Eurostat, the European Union‘s statistics agency, purport the opposite: exodus has picked up last year - 50,000 Lithuanian citizens left the country for a better life abroad, up from 44,500 in the previous year.

Over 200 people could have died in Mediterranean

It is assumed that over 200 migrants might have drowned this week in the Mediterranean, off the coast of Libya, a Spanish humanitarian aid organisation feared.