The Latvian Chamber of Commerce and Industry (LCCI) is generally against tax increases, said LCCI Chairwoman Katrina Zarina in an interview with the LETA agency.
"If politicians and officials are unable to find areas where they can save, where they can improve the efficiency of their work, where they can shift the focus from expenses to investments, then talking about raising taxes to continue financing all existing inefficiencies... It is very difficult for us to agree with this because it is wrong. It is wrong not to improve efficiency, it is wrong not to evaluate what can be abandoned, not to conduct an audit of functions and simply continue to raise taxes. This is unsustainable," said Zarina.
She pointed out that the Latvian Chamber of Commerce and Industry (LCCI) has already proposed and discussed reducing labor taxes, so the organization would not like to see an increase in them, as it would affect labor costs and the competitiveness of enterprises both in the region and on a broader scale.
Zarina also noted that the excise tax is regularly increased, as is the tax on natural resources, so the value-added tax (VAT) remains the only one that has not changed for a long time, and it will become a topic for discussion.
Zarina emphasized that the LCCI is generally against tax increases, but it is necessary to monitor the situation's development.
Moreover, she noted that discussions about taxes are always a process in which it is important to understand exactly what the funds will be used for and how much money will remain in the local economy.
Zarina also indicated that if it comes to financing defense capabilities, firstly, there is a budget deficit, and secondly, it is planned to use the European credit program SAFE, the funds of which will start to be repaid in ten years. The question is how much of these funds will remain in Latvia and how much will go to other economies. The Ministry of Defense promises that at least 30% of the funding will remain in Latvia; however, the mechanism itself is still quite unclear. Therefore, the issue of tax increases will be a subject of discussion, and the LCCI will critically assess each proposal in terms of its impact on the economy.
