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Residents gather signatures to support relatives from abroad without double taxation

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Baltic news, News from Latvia, BNN.LV, BNN-NEWS.COM, BNN-NEWS.RUOn Monday, 2 January, European Latvians Community launched a civil initiative, asking citizens to sign a petition to allow them to financially support from abroad without double taxation and unreasonable administrative obstacles.

Signature gathering is being carried out through ManaBalss.lv portal. The goal of the initiative is to achieve amendments to Personal Income Tax Law. Currently the law states that money transferred to Latvia at a specific amount must be declared and applied with tax rate of 23%. ELA offers lifting PIT from money transfers intended to support relatives and only applying declaration measures on amounts that exceed 12 minimal monthly wages.

«Every year our community sends as much money back home as much our government spends on defence and healthcare annually. This money is not just abstract numbers. For many in Latvia this money is nothing short of a life-line. It is the money they need to survive, the money retired parents receive from their children to pay for medicine and doctors, the money to pay for education and the money to pay for rent and other utilities in Latvia,» – says ELA praesidium’s representative Elina Pinto.

The current system creates three problems. First of all, money sent to Latvia is applied with double taxation even though taxes associated with that money is already paid in the sender’s country. Secondly, tax application on money recipients especially applies to less socially protected people. Testimonies compiled by ELA from Latvians living abroad show that money sent from foreign countries to Latvia are often sent to poor relatives.

«Their money in Latvia is handed to relatives in need – pensioners, children, people in rural regions, for whom receiving money from a bank or ATM is not a solution. Application of 23% tax rate immensely impacts socially unprotected people,» – representatives say.

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