Financial Services, Latvia, Legislation, Wages

"During the pre-election period, politicians were emphasizing the necessity to reduce income inequality in Latvia, as well as to increase the minimum wage. The government has fulfilled this promise, however, we must not stop at this and move on toward differentiated non-taxable minimum, thus providing support to the low-income earners," Finance Minister Janis Reirs (Unity) says.

In order to reduce income inequality, the government plans to introduce progressive income tax in 2016 by increasing the untaxed minimum for low-income earners and removing it for high-income earners. The government also plans to increase income tax holidays by increasing benefits for the second and every next child in a family.

It is said that the minimum wage will be increased in all three Baltic States in 2015: in Latvia – from EUR 320 to EUR 360, in Lithuania – from EUR 290 to EUR 300, in Estonia – from EUR 355 to EUR 390.