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Wednesday 26.07.2017 | Name days: Ance, Anna, Annija
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Employers: to increase wages, tax rise must not be allowed

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Baltic news, News from Latvia, BNN.LV, BNN-NEWS.COM, BNN-NEWS.RU«Social and cooperation partners have taken active part in the development of tax reform guidelines. Nevertheless, the ruling coalition is taking its time with making this important decision. On top of that, the ruling coalition is ignoring opinions from employers and employees,» say Latvian Employers’ Confederation.

The confederation notes that the initial intention behind the tax reform was creating an environment that would be more beneficial to business development for more productive growth of GDP and higher competition among Baltic States. «On top of that, it was planned for tax burden’s decline on labour force to be felt by all workers.»

LEC emphasizes that the direction the ruling coalition has taken in the past weeks in relation to the tax reform has turned the other way around. The current situation and public statements all seem to point towards the coalition unwillingness to listen to the complex offer proposed by the National Council for Trilateral Cooperation.

«I invite members of the ruling coalition not to ignore principles of civil dialogue and avoid making decisions behind closed doors without giving a thought to opinions of the country’s taxpayers – employers and employees,» says LEC President Vitalijs Gavrilovs.

He says that if the planned labour tax reduction is realized, every employed person, especially in the small wage sector will feel it in 2018 – Latvia’s Centenary. This is because LEC supports reducing PIT from 23% to 20% and raising non-taxable minimum for ever dependent. «This would benefit every Latvian resident in 2018.»

Gavrilovs notes that to increase wages, it is necessary not to allow further rise of taxes. «Employers do not agree with the publicly voiced opinion about higher progressiveness of PIT rate. It will only reduce people’s motivation to pay taxes, increasing the already high grey economy. So, in order to achieve balanced and more transparent tax policy, I ask the government to organize a meeting and together with social and cooperation partners reach an agreement on future actions,» Gavrilovs said.

LEC reminds that all sides of the National Council for Trilateral Cooperation support the offer for a complex solution and Finance Ministry’s developed project for state tax policy’s guidelines 2018-2022.

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