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Mobile telephony company Tele 2 CEO Valdis Vancovics confirmed that his company would also apply for a tax break for the development of its 4G network in Latvia, newspaper Dienas Bizness reports today.

Vancovics admits, however, that this could put the state in an "awkward situation" because the government could find it hard to support the telecommunication companies and at the same time ensure that budget revenue does not suffer.

The Economy Ministry believes that the state must stimulate long-term investments into new, profitable products and services, that introduce new export opportunities, make companies more competitive, and create preconditions for higher wages in the national economy.

Since 2011, the government has granted tax breaks to seven investment projects of Dobeles dzirnavnieks, Baltic Crystal, Tervetes AL, AKG Thermotechnik Lettland, Metalleks, L-Ekspresis and Olainfarm.