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Tuesday 20.02.2018 | Name days: Smuidra, Vitauts, Smuidris
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FM: if fuel consumption drops considerably, government will discuss excise tax changes

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Baltic news, News from Latvia, BNN.LV, BNN-NEWS.COM, BNN-NEWS.RUIf fuel consumption drops considerably in the country, the government may reconsider the decision to increase excise tax, said Latvian Finance Minister Dana Reizniece-Ozola in an interview to LNT 900 seconds programme.

She says the decision to increase excise tax for fuel, cigarettes and alcohol is a compensating mechanism to secure income for the state budget lost as a result of the tax reform. The minister also adds that increasing excise tax is a compromise and that rates have been compared with those present in neighbouring countries.

Still, Reizniece-Ozola promises the government will closely follow the situation, ensuring that if fuel consumption declines the government would be ready to review its decision on increasing excise tax.

BNN had previously reported that amendments to the Excise Tax Law are intended to compensate the lost revenue caused by the tax reform. It is planned to raise taxes on fuel, cigarettes and alcohol.

Tax rate for 1,000 litres of unleaded petrol will be increased by 7.8% – from EUR 436 to EUR 470 in 2018. The tax rate for leaded petrol will be increased by 24% – from EUR 455.3 to EUR 564.

Excise tax for diesel fuel will be increased by 11% – from EUR 341 to EUR 378 for 1,000 litres. The tax rate for liquefied Liquefied petroleum gas will be increased by 12% – from EUR 206 to EUR 231 for 1,000 litres.

Excise tax rate for cigarettes will be raised 5.5% – from EUR 67 for 1,000 cigarettes to EUR 70.7 from 1 July 2018 onward. Excise tax for wine will be raised 18% – from EUR 78 for 100 litres to EUR 92. Excise tax for beer will be increased by 24%.

Ref: 225.109.109.5102


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  1. Beema says:

    Strikingly empiric approcach to policymaking: “If this doesn’t work, we change the rates again”. Does this really provides for stable tax environment of which LV authorities are speaking so much. And how about tax certainty?

    Thumb up 0 Thumb down 0

  2. zerry says:

    Did they think at all how much and wide the fuel price increase may effect? Well, do they generally use to think anything? Or is this that attracting investments to Latvia :)

    Thumb up 0 Thumb down 0

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