19 Oct 2017 10:28 |Category:  LAT English 1st page news

Saeima sends Latvia's 2018 budget bill to committees

RIGA, Oct 19, BNS - Saeima today voted to forward Latvia’s 2018 budget bill and a package of related legislation to parliament committees.

The legislative package includes two new draft laws, amendments to 26 laws, as well as a draft law on Latvia’s medium-term budget framework and the draft 2018 budget.

The budget bill was endorsed by 53 lawmakers representing the government coalition and several independent MPs, while 28 opposition MPs voted against. Five other MPs did not take part in the voting.

According to the budget bill, next year, Latvia’s budget 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.

Health care has been defined as the 2018 budget’s top priority, as for the first time Latvia’s health budget is expected to exceed EUR 1 billion.

Politicians have promised to scrap the so-called “lawmaker quotas while working on next year’s budget, which means that no funds will be made available for various projects backed by parliamentarians, but they are expected to come up with ideas on how to use budget money more efficiently.

The first reading of the budget bill in Saeima is scheduled for the end of October, and the final reading will take place at the end of November.

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 percent.

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 percent 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 percent of personal income tax revenues will go to municipal budgets and 20 percent 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 percent 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.

BNS, +371 67088611, zinas@bns.lv

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