RIGA - Former Latvian President and current Saeima member Valdis Zatlers said on Sept. 27, with irony, that Riga Mayor Nils Usakovs’ (Harmony Center) proposals to implement differentiated tariffs for Riga residents and city guests for the use of bus transport can be seen as doing things the way the “Soviet occupiers used to think.”
“Such a proposal reminds me of something I have experienced in Moscow, when I was asked to pay a higher price to visit a museum than my wife, who was able to speak in better Russian than me. She got herself a ticket [at a price] meant for locals,” Zatlers said.
“I would much rather pay the same price for a ride on Riga public transportation as my colleague in parliament from Liepaja, Valerijs Agesins (Harmony Center),” Zatlers added.
What is all the commotion about? On Sept. 25, Usakovs announced the changes up ahead for Riga’s public transportation system on his Facebook account. The ‘bad news’ is for those persons without official residency in Riga, including tourists: as of Jan. 1, one ride will cost them 1.20 euros, or twice as much as they pay now.
The ‘good news’ is for registered Rigans where, as of the new year, one ride on public transportation will cost less - 0.60 euros (0.42 lats), lower than the current 0.50 lats.
Usakovs calls the new system “simple.” Up to Dec. 31, residents will have to take out a personalized e-ticket, the so-called “Rigan card.” The mayor explains that “the rest will be automatic, no papers or any other document will be necessary.”
And, for those registered Rigans signing up by Dec. 31, a one-month e-ticket for free as a special bonus awaits them, beams the mayor.
Those living in local communities outside of Riga should not criticize the Riga City Council; instead, they should turn to their mayors and request the signing of contracts with the Riga City Council, “for everyone to benefit,” believes Usakovs.
Local governments around Riga should not make jokes about imposing mushroom-picking taxes on Rigans. Instead, their local governments should sit down at the negotiating table and seek mutually beneficial solutions. The Riga City Council is ready to sign contracts with all local governments in the vicinity of Riga and to do so on mutually beneficial terms, regarding the new ticket pricing, explains Usakovs.
The current tax system stipulates that personal income tax revenue goes to those local governments where residents are officially registered, regardless of whether they work there or not. Thus personal income tax revenue for a person who works in Riga and lives, for example, in Babite, goes to Babite. Thus Riga, whose budget is around 500 million lats, transfers around 250 million lats to other local governments for those residents who work in Riga but are officially registered living in another community.
It is not fair, and it also means that Rigans, when purchasing public transportation tickets, are forced to pay for non-Rigans, says Usakovs.
This is price discrimination. One wonders how far Usakovs and his government will take this. Maybe next will be charging a higher VAT tax for visitors to have lunch in a city restaurant? There are legitimate concerns in the taxation policy between Riga and the suburbs, as he mentions, but targeting one section of public services isn’t the most effective way to deal with it.