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Sunday 25.08.2019 | Name days: Patrīcija, Ludis, Ludvigs, Ivonna
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Ombudsman: what did ex-finance minister Reizniece-Ozola fail to understand?

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Baltic news, News from Latvia, BNN.LV, BNN-NEWS.COM, BNN-NEWS.RUAfter the publication of a study about the influence of tax reform on Latvian residents, ombudsman Juris Jansons received many questions from certain members of society about the flaws with the tax reform uncovered by the study. The ombudsman was especially confused by the statement from ex-finance minister Dana Reizniece-Ozola, who said criticisms of the tax reforms sounded unjustified even though she has yet to go through the study, the ombudsman’s office reports.

It is stressed that during the tax reform development process Saeima’s Legal Affairs Office had noted that «the submitted legislative draft, due to its complexity, could cause major problems for legislators to understand the content of regulations.»

Implementing the new tax reform, application of PIT and calculation of non-taxable minimum and its application order has become more complicated and less friendly for taxpayers. This situation potentially provides for the possibility of situations when taxpayers could end up debtors in spite of paying taxes, the ombudsman’s office explains.

In addition to the problems outlined by the new tax reform the ombudsman outlines two other major subjects in relation to eligible expenses. First of all, some residents have no rights to receive tax returns for eligible expenses (healthcare services, education, etc.) and benefits. Most of them are taxpayers will relatively small wages and multiple dependents. There is a level of contradiction between the state tax policy and the desire to reduce inequality. For example, although the new tax reform has increased non-taxable minimum for dependents and at the same time some of the parents have reduced options to use provided benefits and eligible expenses.

The ombudsman proposes careful evaluation of the study, which has detailed information about its goal and methodology, as well as careful analysis of legal aspects and practical application of the reform.


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