bnn.lv Latviski   bnn-news.com English   bnn-news.ru По-русски
Wednesday 26.04.2017 | Name days: Rūsiņš, Sandris, Alīna
LatviaLatvia

Economic Diary of Latvia. Our people – we can find common ground. Or can we?

FaceBook
Twitter
Draugiem
print
(No Ratings Yet)

Baltic news, News from Latvia, BNN.LV, BNN-NEWS.COM, BNN-NEWS.RUThis week the Latvian government mused ideas for new tax initiatives. No actual progress has been made so far, but, considering certain circumstances, it is not what matters the most.

Latvia’s Economy Ministry has submitted to the government a draft of rules for the adoption of a new fee in order to motivate businessmen to pay more attention to matters of energy efficiency.

The ministry proposes adopting an energy efficiency fee worth 7% of electrical energy consumed for the previous calendar month calculated per each MWh of consumed electricity.

According to the plans of the economic institution, payment of this fee will help reduce the imbalance between businessmen who employ energy audit measures or other kinds of energy management systems and those who do not.

This fee should be considered an instrument to control the energy management system in the realization of energy efficiency means to help achieve the goal set by the government – save 9,896 GWh of energy in end consumer sectors by 2020, as noted by the ministry. This fee would be applied to businessmen whose companies consume a lot of electrical energy (more than 500 MWh per year) if there is no way for them to adopt an energy audit or energy management system on their own.

According to initial estimates, revenue from this fee could reach approximately EUR 553,000 in 2017, EUR 2.52 million in 2018 and nearly EUR 1.45 million in 2019.

Politicians had previously demonstrated their ability to think outside the box and application of fiscal instruments by adopting the Solidarity Tax. The fate of this particular tax turned out comical and tragic at the same time. First it turned out that the number of payers of this tax had declined by 20 or 30 percent from the number mentioned in official documents (which is something that should have been expected, because people who receive wages of more than EUR 4,000 per month, who were the target audience of this tax, work in large and respective companies that usually have a team of professional tax consultants and lawyers, who also earn a lot not just for having pretty eyes, but rather for their knowledge and ability to make sure the ‘right’ money is not subjected to taxes without breaching any laws in the process). Later on, businessmen decided to challenge the adoption of this tax in the Constitutional Court. After that, Finance Minister Dana Reizniece-Ozola admitted that the adoption of this tax reduced the trust of entrepreneurs toward the state. Nevertheless, the head of the ministry noted that the idea of this tax is correct – the form and execution, on the other hand, is flawed. The minister believes there is no need to cancel the tax. She proposes changing it into a social tax to make sure those who pay it also receive some benefits.

The constitutional court will decide on whether or not to accept the plea on 28 July.

Holy place does not remain empty for long

There are still more questions than answers in the matter of leadership for the State Revenue Service. Inga Kolegova, Director of the State Environmental Service, remains the only candidate to lead SRS. Kolegova refuses to comment this information, as she is currently on vacation.

Previously Prime Minister Maris Kucinskis met with the head of the State Treasury Kaspars Abolins, who was considered a candidate for the aforementioned post for a time. Abolins, however, refused to become a candidate.

Finance Minister Dana Reizniece-Ozola does seem to have other candidates, but their names are not revealed at this time. According to the information that was leaked to the press, it is known that aside from Kolegova and Abolins the offer to lead SRS was also offered to the Director of the Consumer Rights Protection Centre Baiba Vitolina.

The story about finding a replacement for Inara Petersone is similar to the situation following Laimdota Straujuma’s decision to step down. As we all remember, the search for the new head of the government cost President Raimonds Vejonis’ health a lot: the president was hospitalized the day after the announcement of Maris Kucinskis’ name.

The lack of appropriate candidates for big posts in state administration means the queue is nearly empty. And this is a very, very bad sign. It means the country has a lack of labour force and the elite. Elite in this case does not mean incredibly wealthy people who can afford expensive cars and yachts. In this case it means people with good education, plenty of experience, skills, broad thinking and capability to lead the small ship called Latvia through all geopolitical and economic storms safely.

The ‘right’ people

In the context of deficit of capable professionals, it is worth mentioning the discussion organized by Neatkarīgā with representatives of New Latvians association, which unites recipients of residence permits.

The newspaper prepared an article based on results of the discussion. Here are some excerpts from the article.

‘The most important part of society is being washed away from Latvia. Professionals leave for countries where they are in demand. But it was not easy for anyone who has relocated to Latvia for life to rise above the middle class. We managed largely thanks to our professional skills and education. We have our own human capital. I believe such a group of professionals loyal to Latvia could prove useful. We have homes and funds. We are not focused on survival. With that, we can offer a lot,’ – said psychologist Maria Shumihina.

Sociologist Irina Krilova noted that demographically useful residents are travelling to Latvia. They are interested in helping Latvia become stable and developing Latvia. «They are prepared to invest their own human resources. It is their main capital at the moment,» – she noted.

«The people who travel to Latvia as part of the residence permit programme travel here to create. Not to make money and receive the biggest cuts – Russia is a better destination for that. There are more problems in that country. Therefore – there are more opportunities for such a business. In Latvia, on the other hand, it is possible to create businesses that benefit society, the state and infrastructure,» – added entrepreneur Pavel Pereverzev.

When asked if those people intend to integrate in Latvia’s environment, Krilova responded by saying that it was the initial goal: people part of the residence permit system actively study the language and culture.

This does sound like a utopia, but in conditions of chronic deficit of skilled workers and elite this group of New Latvians may take the free space in the country. In the political and economic context, as well as the migration crisis in Europe, the government should think not of ways to increase taxes or create new ones, but rather that the education and healthcare sectors gradually become critically important for the economy and the country’s survival. Latvia desperately needs healthy and educated people. Latvia’s own people.

Ref: 017.109.109.6799


Leave a reply

Vegetable producers: the industry has a future, but it is burdened by taxes

Compared with Europe’s southern territories, vegetable and fruit production in Latvia has a future, says manager of Mūsmāju dārzeņi association Edite Strazdina.

European Commission takes on Hungary regarding its higher education law

EU’s European Commission has commenced legal action against the Hungarian government in relation to the country’s education law, which is said to be endangering Budapest’s Central European University.

Last year foreign travellers stayed in Latvia for longer, but spent less money

In 2016, foreign travellers crossed the border of Latvia 6.8 million times, which is 0.7 % less than during the previous year. Last year foreign travellers spent EUR 645.2 million in Latvia – EUR 97.0 million or 13.1 % less than in 2015.

Pulks: Riga municipality’s social network accounts are financed by residents; KNAB investigates

«Social network accounts of Riga municipality were created using money of Riga residents. They cannot be illegally privatized to then be used to accomplish political goals,» says Riga City Council’s Unity faction deputy chairman Olafs Pulks.

Ministry: Latvian companies have unused potential in exploring Spain’s market

Latvian companies have unused potential in exploring Spain’s market. This is why the opening of direct flight connectivity between Riga and Madrid could open up new opportunities for business and tourism, says Latvian Foreign Affairs Minister Edgars Rinkevics.

Every third resident would be unable to pay bills if they lose their job

Every third Latvian resident would experience difficulties covering monthly expenses if they suddenly lost their job, according to results of Swedbank Insurance study.

Estonia’s health workers agree to pay-rise solution

Following five months of talks with Estonian government and health officials, five Estonian trade unions of health workers have signed a collective agreement, agreeing to a pay-rise and abandoning plans to hold long strikes.

Economist: Latvian residents’ overall satisfaction with life is below most EU countries

There are many different measurements in the world that seem impossible to measure – our quality of life and development progress, says Bank of Latvia economist Daina Paula in a publication of makroekonomika.lv, commenting on different measurements that help characterize development of national economy and people’s quality of life.

Estonian ex-PM: Bronze Night riots in Tallinn coordinated by Russian officers on site

On the 10th anniversary of the Bronze Night riots in Tallinn, the then Prime Minister Andrus Ansip has noted that Russian special forces’ officers were in the Estonian capital coordinating, where vodka and flammable liquids were supplied.

Reporters Without Borders: media experience unprecedented threats

«The freedom of press in the world has never been more at risk than it is now,» announced Reporters Without Borders in its annual World Press Freedom Index on Wednesday, 26 April.

Several media-related people become candidates in municipal elections in Latvia

Among candidates that intend to participate in the upcoming municipal elections in Latvia are several people who are closely associated with the media environment. Not all of them, however, have direct ties to journalist work.

Coca-Cola facing lower demand to cut 1 200 workers

U.S. company Coca-Cola has stated that it plans to lay off around 1,200 workers in the world as the fizzy drinks producer is facing lower demand.

Cyber-security experts: Macron’s campaign in France targeted by hackers

The campaign staff of French presidential candidate Emmanuel Macron has been targeted by a group of Russian hackers, employing an extensive arsenal of high-tech tricks to acquire the login names, passwords and other credentials, security experts have found.

Ministry: EU should oppose hybrid threats more strongly

«To strengthen EU’s defensive capabilities, member states should increase defence expenditure and work to further enhance cooperation and coordination in the entire union. At the same time, the EU should further enhance its capabilities to better oppose hybrid threats so that they cannot be caught off-guard,» notes Latvian Foreign Affairs Ministry’s parliamentary secretary Zanda Kalnina-Lukasevica.

Ombudsman turns to Constitutional Court over low wages of medics

Ombudsman Juris Jansons has decided to turn to the Constitutional Court over non-compliance with requirements of Medical Treatment Law in relation to the principle of equality and guaranteed rights for fair pay.

Vejonis: new tax system will start working if everyone starts paying taxes honestly

«To improve the development of Latvia’s national economy and residents’ welfare, it is important to realize an efficient tax reform, which is one of the main objectives for the government,» said Latvian President Raimonds Vejonis during his meeting with chairman of Latvian Free Trade Unions Association Egils Baldzens on Tuesday, 25 April.

Verzemnieks: non-taxable minimum for pensions should be increased to EUR 500

The government has to realize a tax reform in which non-taxable minimum is increased to at least EUR 500, says author of the Tax-free Pension initiative Arnis Verzemnieks.

Swedish meteorologists warn of up to 20 cm snow

While people in Baltics are asking, when will arrive the warm part of spring, weather forecasters in Sweden warn of heavy post-season snowfall, which could bring up to 20 centimetres of snow.

Producer price level in industry up 0.1% in Latvia this March

Compared to February, the average level of producer prices in Latvian industry grew by 0.1 % in March 2017.

Lembergs continues prolonging court process; prosecutors concerned

Aivars Lembergs’ criminal case remains in court for the ninth year. The past seven months have been spent solely on listening to Aivars Lembergs’ testimony. Prosecutors are concerned that the accused may be using his testimony to prolong the court process, as reported by Latvijas Radio about the state of the criminal case and prosecutors’ opinion of it.

Swedbank: Latvian residents often lack the money to cover all expenses

Latvian residents plan their family budget in a short-term perspective. Because of that, they often lack the money to cover all expenses, according to data of a study performed by Swedbank Institute of Finances.

In pictures: Protesters in Venezuela block roads in nation-wide sit-in

Opposition protesters in Venezuela rallied on Monday, April 24, promising to block Venezuela s main roads to raise pressure on the government of Nicolas Maduro after three weeks of deadly unrest that have left 21 people dead.

CM: the need for media content creation exceeds financial capabilities

The tendering procedure for support of creation of public media content requested five times more money than what is available, said Culture Ministry’s policy department manager Roberts Putnis in an interview to Latvijas Radio.

Cargo turnover of Baltic ports up 5% in Q1 2017

In the first three months of 2017, ports of Baltic States received and transshipped a total of 39.97 million tonnes of cargoes, which is 5% more when compared with the same period of 2016.

Estonia plans to allocate additional EUR 5 million for HIV spread prevention

Estonia plans to invest into HIV and AIDS medications and related services a total of 5,5 million euros, sets forth the state budget strategy for 2018-2021 passed by the Estonian government.