Government declaration proposals may cost Latvia EUR 600 million this year

If all proposals submitted for the government declaration were to be implemented this year, it would require an additional amount of EUR 660 million, prime minister candidate Krišjānis Kariņš told journalists.

«In 2019 we will not have the option of dividing more finances, because the question is about how much we can include in the already set deficit level. The new government’s policy would begin in 2020,» said Kariņš.

At the same time, he says desires currently exceed opportunities. Nevertheless, the government’s desires are not completely unbalanced. If parties agree to sign the fiscal discipline agreement, it will not be possible to implement all of those proposals to their full extent, said the prime minister candidate. He said it may be possible to implement proposals gradually.

The politician stresses that there are no plans for any new taxes this year. Generally, he said, it is planned to stick to ‘budget deficit borders’.

Kariņš confirmed that it is planned to increase doctors’ wages. When asked which promises the government may reject, the prime minister candidate said: «We will not look at which promises we can reject. The question is do those promises have any coverage. Nearly all of them do,» he said.

In 2020 implementation of all proposals would require an additional amount of EUR 1.2 billion, according to information from LETA.

Attīstības/Par co-chairman Juris Pūce told journalists on Monday, 14 January, that parties will soon continue working on unresolved matters. Nevertheless, there are no insurmountable problems, said Pūce.

As for budget affairs, Pūce said representatives could also decide on reviewing certain measures. For example, there are budget affairs majority parties do not consider objective for future implementation, explained Pūce.

Among the reviewed measures could be the guarantee of municipal tax revenue of 19.6% from total budget tax revenue. This matter could be discussed during the budget review process, said the politician.

He also added that among the proposals for the government declaration that could require the most funding could be the commitment to make sure Latvia’s labour tax is more competitive in Baltic States, as well as the initiative to comply with Higher Education Law’s section on funding.

New Conservative Party leader Jānis Bordāns stressed that there are many matters that do not require additional funding. As an example he mentioned the question regarding cooperation between Justice Ministry, Interior Affairs Ministry and the Prosecutor General’s Office.

Agriculture Minister candidate Kaspars Gerhards says politicians will move towards finding common ground on multiple matters.

As it is known, Kariņš has promised to offer government partners to sign the Fiscal Pact. This includes offering no support for raising taxes and adoption of new taxes. With this document, parties are committed to fulfilling and sticking to Latvia’s medium-term budget outlooks.

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