Budget, Financial Services, Latvia, Taxation

The Latvian general government consolidated budget showed a EUR 236.1 mln euros surplus in the first ten months of this year, or down by EUR 67.5 mln euros compared to January-October 2015. The surplus has decreased mostly due to a 24.1 % rise in expenditure in October. Expenditure in both the central government budget and the local government budget is expected to grow more steeply in the last two months of the year therefore a financial deficit is likely to occur in the general government consolidated budget at the end of the year.

Among other things, expenditure on social benefits in the special budget increased by EUR 112.3 mln or 5.3 % in the first ten months of this year.

Meanwhile, revenues to the general government consolidated budget increased by EUR 71.8 mln or 1% compared to the 10-month period in 2015.Tax revenues rose by EUR 324.4 mln or 5.6 % y-o-y.

For example, revenues from excise tax increased by EUR 53.9 mln or 8.2% in the first ten months of this year, mostly due to growing consumption of diesel fuel and tobacco products as well as higher tax rates. Excise tax revenues in January-October 2016 were EUR 30.9 mln or 4.5% above the target. Revenues from corporate income tax grew EUR 33.1 mln or 10.3%, rising EUR 19.3 mln above the target.

Non-tax revenues in the first ten months of this year totaled EUR 489.4 mln, which is a growth by EUR 78.4 mln or 19.1% from the same period in 2015, and the non-tax revenue target has been met by 110.7%.