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Monday 20.10.2014 | Name days: Leonīda, Leonīds
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Economist: property tax should be raised and bigger pensions taxed

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Economist Vjačeslavs Dombrovskis

An alternative of how to cut expenditure even more than proposed by the government is to revoke the reduced VAT rates, introducing compensation mechanisms for the destitute and rise the property tax even more rapidly, as well as bigger pensions, for example, above 180 lats should be applied additional tax, says the economist Vjačeslavs Dombrovskis.

On getting acquainted with the Latvian Chamber of Commerce and Industry (LCCI) proposals of how to cut the sate budget even more, Dombrovskis informed the newspaper Diena there are both, ideas that can be supported and those that cannot.

The economist fully agrees with LCCI idea to divert the small family benefit only for needy families with children. Dombrovskis does not support the proposal to save at the expense of teachers, as he believes such mechanical cuts of teachers’ salaries will not have the awaited effect. Although the economist reveals he does not favour the higher education system financing in Latvia, he objects to LCCI proposal to reduce state-funded places. To his mind, unemployment benefits payment term shortening has many aspects to be looked at as well.

The economist refrains from commenting upon the rest of LCCI proposals, for example, the state administration centralization, as to do that one should be aware of the matters going on there. Dombrovskis believes it is already too late to implement structural reforms for the next year as there is only a month left, yet at least a year is necessary to prepare well-though over and qualitative reforms.


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