Latvia: 2020 budget revenue projected at EUR 9.89 billion, spending at EUR 10 billion

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At an extraordinary meeting on Friday, the Cabinet of Ministers endorsed the 2020 state budget, where consolidated budget revenue is projected at EUR 9.89 billion and spending at EUR 10 billion.

Compared to the 2019 budget, next year revenue will increase by EUR 717.1 million and expenditure by EUR 610.1 million.

The general budget revenue in 2020 is projected at EUR 6.88 billion and expenditure at EUR 7.22 billion. Compared to the 2019 budget, the general budget expenditure next year will increase EUR 400 million or 5.9 percent.

Financing for implementation of projects and measures co-financed by the European Union policy instruments and other foreign financial assistance will increase EUR 74.8 million.

The social budget’s revenue and expenditure are projected at EUR 3.2 billion and EUR 2.97 billion respectively. The special budget expenditure will be EUR 211.2 million or 7.6 percent higher than this year.

The government also approved an earmarked subsidy for local governments in the amount of EUR 382,689,344 and a state budget subsidy to municipalities in the amount of EUR 184,539,752.

Next year, 80 percent of revenue from personal income tax will go to local governments and 20 percent will be paid into the state budget. Personal income tax revenue for local governments is projected at EUR 1.4 billion.

In order to compensate for the Riga municipal public transport company Rigas Satiksme’s negative fiscal impact on the general budget, the State Treasury will deduct EUR 38 million from personal income tax revenue received by the Riga City Council.

Gross domestic product at current prices is projected at EUR 33.154 billion next year. Maximum general budget deficit next year is set at 0.3 percent of GDP.

The maximum government debt at the end of 2020 has been set at EUR 11.75 billion.

EUR 1,889,071 will be allotted from the 2020 budget to the Education and Science Ministry for repayment of student and study loans.

The budget bill stipulates that the 2020 budget will receive at least EUR 127,070,731 in dividends for 2019 from power utility Latvenergo, at least EUR 71,065,500 from Latvijas Valsts Mezi forestry company, at least 2,241,000 from Latvijas Loto lotteries company, and at least EUR 1,735,958 from power transmission company Augstsprieguma Tikls.

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