Budget, EU – Baltic States, Financial Services, Latvia

At the same time, the European Commission has indicated in its assessment of the Latvian government's draft budget for 2020 that the plant's implementation might result in some deviation from Latvia’s medium-term budgetary objective.

If the structural balance for Latvia is no longer projected to be close to the medium-term budgetary objective in future assessments, the overall assessment of  compliance will need to take into account the extent of the deviation from the requirement set by the Council. 

The Commission also said that as a result of tax cuts, the share of tax revenue against the economy has decreased, preventing Latvia from increasing public spending, including on salaries, pensions and benefits, at a faster pace.

As reported, on October 11 the Cabinet of Ministers endorsed the 2020 state budget, where consolidated budget revenue is projected at EUR 9.89 bn and spending at EUR 10 bn. In accordance with the European Union's rules the daft budget was sent to the European Commission and the Eurogroup for approval. 

Saeima passed Latvia's 2020 budget in the final reading on November 14.