Latviski English По-русски
Ceturtdiena 19.10.2017 | Name days: Drosma, Drosmis, Elīna

Economic Diary of Latvia. Watch out – finks!

(No Ratings Yet)

Baltic news, News from Latvia, BNN.LV, BNN-NEWS.COM, BNN-NEWS.RUThis week, the Enterprise Register and Justice Ministry launched a campaign titled ‘Businessman, sort out your papers!’ The goal of this campaign is to inform business people that it will become much easier to re-register company capital from lats to euro.

The two institutions have developed amendments to the Law on Commerce. The Cabinet of Minister promptly approved these amendments on March 31st. Changes particularly apply to LTDs that have only one owner. There are approximately 74.5 thousand of such companies in Latvia. They form 80% of all registered subjects that carry out commercial activity.

The problem the Enterprise Register and Justice Ministry are trying to solve may seem not serious at first. Regardless, it causes a lot of busywork. The thing is that capitals in lats were stated in round numbers, so authorities decided to preserve the same rule for euro. However, conversion from lats to euro presents fractional numbers.

It is necessary to come up with a way to handle decimals, because entrepreneurs do not know what to do: how far to round number in order to maintain proportions.

Watch out – finks!

It became known this week that the State Revenue Service often uses information provided by finks in its work.

As noted by the head of SRS Inara Petersone in her interview to Latvijas Radio, the organization often receives information regarding tax avoiders from residents – more than 5,000 reports had been received in 2014. People provide detailed reports and information provided in them greatly assists SRS.

SRS plans to publish information regarding taxes paid by Latvian companies every year. Taxes paid for employees of companies will be emphasized. According to SRS, an open database that contains information about most companies will allow authorities to quickly compile expenses of companies.

According to Petersone, Latvia is quickly headed to full openness. People want to know everything – income of officials, teachers and businessmen. Publication of information about taxes paid by companies will be used as another tool to help combat shadow economy, which still has a strong presence in Latvia.

Authorities in other countries also often employ finks to gather sensitive information. This especially applies to USA. In 2006, amendments were added to American tax legislation that greatly increased reward for tax informants: to 15-30% of money transferred to the state budget from unpaid tax. This served to tremendously increase activity of tax informants.

«Report your friend and you will become a millionaire,» – this was the approximate motto presented by Turkish Finance Ministry several years ago. If the reported information is confirmed later on, the informant receives 10% of the unpaid tax amount.

In France, tax inspectors actively use anonymous letters, information provided by neighbours and informants. Other countries are starting to take notice of the informant culture, including Latvia.

A meeting in the tops

Although this event does not hold any economic value, it is worth mentioning nonetheless, as the economic effect from it may come back in the near future. An informal meeting of the Council of Ministers of Baltic States took place in Vilnius this Friday, April 10th. Officials of Baltic States discussed matters of security, energy and transport together.

Officials also discussed preparations for the Eastern Partnership Summit, which is planned to be held in Riga May 21-22.

This is where it gets interesting. It is planned to discuss the matter of providing Ukraine a visa-free regime starting January 1st, 2016.

Ukraine launched a simplified visa regime wit Europe on July 1st, 2013. Now Kyiv is trying to establish a completely visa-free regime. Ukrainian authorities hope the decision regarding a visa-free regime will be made on the upcoming summit in Riga.

Informal meetings of heads of state are held once a year in one of the Baltic States. The last meeting was held in Tallinn in 2014. The prime ministers of Baltic States discussed Rail Baltica. As it can be concluded, such informal meetings more often than not lead to real action.


Leave a reply

Sale of MTG’s business in Baltics to Providence concludes successfully

Wednesday, 18 October, marked the successful conclusion of the sale of Baltic assets owned by Swedish media concern Modern Times Group to Providence Equity Partners. From now on companies previously owned by MTG in Baltics will function as a single organization named All Media Baltics, as confirmed by the company’s manager Pierre Danon.

Estonian port company makes 29% more revenue in January-September

Estonian state port company Port of Tallinn has made the revenue in the amount of 99.1 million euros in the first nine months of 2017, which is a 29% increase compared to January-September in 2016.

42 gambling halls to be closed down in Riga in next five years

On Wednesday, 18 October, Riga City Council supported plans to close another 33 gambling halls in the city. With that, a total of 42 gambling halls will be liquidated in the next five year.

Latvia has the highest index of female CEOs among EU member states

The highest index of female CEOs among European Union member states belongs to Latvia – 47%. In total, only 33% of CEOs in EU were female last year, according to data from the Central Statistical Bureau of Latvia.

Survey: more and more people take notice of benefits provided by EU membership

65% of Latvian residents believe the country’s membership in the European Union has brought tangible benefits. A similar opinion was voiced by 64% of residents of all EU member states in the Eurobarometer study performed by the European Parliament.

17 persons in need of international aid are relocated to Latvia from Turkey

On Tuesday, 17 October, seventeen individuals, including nine children, in need of international protection were relocated to Latvia from Turkey as part of EU resettlement programme, as confirmed by Latvian Office of Citizenship and Migration Affairs.

BATL: to avoid crisis in transit sector, government and Transport Ministry must act

Latvian Prime Minister Māris Kučinskis’ led Latvian Ports, Transit and Logistics Council also supports Saeima’s National Economy Committee’s decision on the need for Transport Ministry to develop a long-term vision for the development of the country’s transit industry.

Psychologist: six-year-old children are not ready for school

«It is wrong to believe that the sooner a child starts going to school, the better their academic results will be. Reforms are performed aggressively, without asking pedagogues or other specialists for their opinion. We lack a comprehensive analysis of the current situation that would be based on studies, not international ratings,» says certified clinical psychologist and psychotherapist Jolanta Lamstere.

Klaipeda transport ticketing system to be installed by Estonian Ridango

In the Lithuanian port city of Klaipeda, Estonian firm Ridango has been selected for installing its technology on public transport.

Policeman in Malta posts he's happy about killing of journalist Galizia

In Malta, where an investigative journalist has been killed this week, a police sergeant has posted on Facebook he felt happy about her death and has been suspended from office a day after.

Exchange indexes reach new records; oil prices increase as well

Dow Jones Industrial Average and Standard & Poor’s 500 index reached new record-high values on Tuesday, 17 October. US dollar value before euro and Japanese yen increased.

Anti-corruption protesters in Ukraine push for reforms

Three protesters and a policeman have been injured in Kyiv, Ukraine, as a crowd of anti-corruption demonstrators voiced their demands for reforms aimed at tackling corruption in the country.

«Islamic state» capital conquered by Syrian Democratic Forces

An alliance of Syrian-Kurdish fighters, which is supported by the U.S., has stated it has gained full control of Raqqa, which has been for three years the centre of the «Islamic state» regime.

Poland hopes Turkey would join EU

Polish President Andrzej Duda meeting his Turkish counterpart shortly before an European Union-Turkey summit has expressed a hope that the country located at the cross-roads between Europe and the Middle East would join the EU some time.

Number of people at risk of poverty in Baltics in higher than the average in EU

The ratio of people subjected to poverty or social exclusion risk in Baltic States is higher than the average in the European Union, according to Eurostat data compiled for 26 out of 28 member states in 2016.

E-voting defended in Estonia after criticism from party leader

Responding to claims from a leader of an Estonian political party that the country’s e-voting system lacks transparency, the head of e-Government Academy’s e-democracy department explained it was possible that the voters of one party are more active e-voters than supporters of other parties.

Residents’ mood worsens; people become more critical about their finances

Over the course of the past month, residents’ general mood has worsened significantly – declines have been noted on all positions analysed by the survey. Residents were critical the most in the survey about their material state – the index in this category declined from -9 to -11, according to the latest Baltic International Bank Latvian Barometer.

Antāne: Saeima’s National Economy Committee has heard the transit industry’s cry

Inga Antāne, president of Baltic Association – Transport and Logistics, is satisfied with the decision that was made at the recent meeting of Saeima’s Economic, Agricultural, Environmental and Regional Policy Committee, asking the Transport Ministry to develop and present a sustainable development strategy for the industry and putting an emphasis on raising the competitiveness of railway tariffs.

Latvian’s attitude towards combating cancer in late stages seems irresponsible

The attitude towards combating cancer in late stages in Latvia remains very low, says former healthcare minister of Latvia Ingrīda Circene.

Hydrogen-powered transport technology – a reality in Latvia

There are plans to establish a hydrogen refuelling station in Riga before the end of 2017. A publicly available H2 refuelling station in Riga would secure an inter-state network of hydrogen refuelling stations: the closest other station will be established in Pernava, says Association Zero Emission Mobility Support chairman Arnis Bergs.

Estonian ministry to collect 270 000 euros from IT company over failure to build information system

Tieto Estonia, the Estonian branch of Finnish IT firm group Tieto will compensate the Estonian Ministry of Social Affairs 270,000 euros for the failure of the SKAIS2 project, the aim of which was the development of a new information system for the Estonian social insurance authority, but was deemed a failure in August.

Latvia invites Iran to act constructively to ensure security

Latvian Foreign Affairs Minister Edgars Rinkēvičs participated in a meeting of the EU Foreign Affairs Council in Luxembourg, where he discussed about the role of Iran in the region and the Joint Comprehensive Plan of Action in light of the upcoming report from US President Donald Trump to the Congress on Iran’s progress realizing the plan.

Vigil held in Malta over killing of investigative journalist

Several thousand people in Malta have taken part in a vigil held after news broke of the killing of an investigative journalist, who blamed Maltese government for corruption.

American exchange indexes reach record-high values; oil prices on the rise

In response to price rise of bank stocks, three leading indexes of US exchanges reached new record heights on Monday, 16 October. In addition, US Federal Reserve System manager Janet Yellen’s prediction regarding a soon inflation rise has increased confidence that base interest rate will increase in December.

54.14% more alcohol exported from Latvia; most of it to Russia

In the first eight months of 2017, a total of 102.259 million litres of alcoholic drinks was exported from Latvia, which is 54.14% more when compared with the same period of last year.