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Ceturtdiena 25.05.2017 | Name days: Junora, Anšlavs
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SRS: it is possible Latvia will not reach the planned economic growth rate

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Baltic news, News from Latvia, BNN.LV, BNN-NEWS.COM, BNN-NEWS.RULatvian State Revenue Service’s general budget revenue plan for the first nine months of this year has been completed 100.8% or EUR 48.52 million more than was planned. Compared with 2015, budget revenue has grown 7.4%.

Revenue growth of the same period of 2015 was 4.5% (3.9% in 2014 and 5.8% in 2013), as reported by SRS.

The biggest increase in revenue is that for excise tax revenue. Compared with the first months of 2015, excise tax revenue has grown by EUR 48.56 million or 8.2%. This was mainly provided by excise tax revenue from oil products and tobacco products. The increase in excise tax revenue can be explained with the rise of tax rates and consumption.

Personal Income Tax revenue in the first nine months of 2016, compared with that of 2015, had grown by 5.2%. It was also the largest increase in the past three years. The increase was mostly affected by the rise in income of the employed. According to information provided in employers’ accounts on social insurance fees and PIT analysis in this period, average monthly income of employed people had grown by 5.9% in the first nine months of 2016. August’s increase was 7.9% in comparison with the same month of 2015.

Nevertheless, the failure to complete the PIT revenue plan for the first nine months of 2016 can be explained with returns of PIT. EUR 81.62 million was repaid in the first nine months of 2016, which is 29.6% more in comparison with the same period of 2015.

EUR 559.21 million was repaid as VAT return in the first nine months of 2016, which is 13.7% less in comparison with the same period of 2015. The most rapid decrease of the returned amount in the first nine months of 2016, in comparison with 2015, was noted for tax payers associated with construction. VAT payment amount for the first nine months of 2016 had declined by EUR 14.83 million or 0.7% in comparison with the first nine months of 2015.

It should be said that GDP growth in actual prices was originally planned at 5.2% for 2016. However, reduction of investments caused by delays with the realization of EU structure funds had negatively impacted GDP growth in Latvia in 2016. According to data from the Central Statistical Bureau of Latvia, the country’s GDP in the first half-year of 2016 was only 2.5% larger than that of the first half-year of 2015. With that, it is possible the planned economic growth rate may not be achieved, which could negatively impact the completion of VAT plan, SRS notes.

Ref: 102.109.109.5890


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