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International Internet Magazine. Baltic States news & analytics Thursday, 19.07.2018, 22:03

Government approves 2018 budget in Latvia

BC, Riga, 11.10.2017.Print version
The Cabinet of Ministers yesterday approved Latvia’s 2018 budget bill, under which revenues are expected to grow by EUR 725.11 million from this year to EUR 8.75 billion, and expenditures are projected to increase by EUR 624.82 million to EUR 8.95 billion, reports LETA.

In 2017, Latvia’s budget revenues are planned at EUR 8.03 billion and expenditures at EUR 8.33 billion.


In 2018, revenues in the government basic budget are planned at EUR 6.16 billion and expenditures at EUR 6.49 billion.


Compared to 2017, next year, expenditures in the government basic budget will grow by EUR 400.4 million or 6.6%.


Financing to EU-funded projects, policy instruments and other projects co-funded by foreign countries will decrease by EUR 78.4 million next year.


Revenues in the government special social budget are projected at EUR 2.77 billion and expenditures at EUR 2.65 billion, with the expenditures expected to grow by EUR 230.4 million or 9.5% against this year.


Subsidies to local governments are planned at EUR 350.88 million next year, with EUR 256,373,650 of that amount earmarked for teachers’ wages, EUR 65,637,452 for special pre-school institutions and EUR 27,893,038 for nursery school teachers’ wages.


The central government’s budget subsidy to the local governments is planned at EUR 57.58 million, which includes EUR 35,821,803 for the local governments’ financial cohesion fund, a EUR 21,106,179 special subsidy and EUR 657,580 for children’s homes and residents of old people’s homes.


According to the budget bill, 80% of personal income tax revenues will go to municipal budgets and 20% to the central government budget. The local governments are expected to receive an estimated EUR 1.383 billion in personal income tax revenues and that their loan limit will be increased by EUR 118,138,258 next year.


Latvia’s maximum national debt is planned at EUR 10.25 billion at the end of 2018, and the finance minister will be authorized to issue guarantees worth EUR 35,956,620 on behalf of the state. The finance minister will also be authorized to cancel EUR 40,897,907 worth of liquidated companies’ debts to the government.


The value of Latvia’s GDP is expected to reach EUR 28.359 billion next year, and the budget deficit is projected at 1% of GDP.


The draft budget law also stipulates the amount state-owned enterprises are expected to pay in dividends to the government budget: Latvenergo power utility will have to pay EUR 94.22 million, Latvijas Valsts Mezi state forest manager EUR 38.22 million and Latvijas Loto national lottery operator EUR 2.8 million.


The budget bill has yet to be approved by Saeima. The 2018 draft budget will be submitted to Saeima  today.

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