RIGA - Latvia's tax system does not need any revolutionary changes at the moment, Uldis Rutkaste, head of the Bank of Latvia's Monetary Policy Department, said in an interview on Latvian Radio yesterday.
The central bank's expert said that a "tax reform would not be a panacea", so the government should not make any revolutionary changes.
At the same time, Rutkaste suggested focusing on the application of taxes and tax rebates for entrepreneurs starting new businesses.
Rutkaste noted that in Latvia, labor taxes are higher than in neighbor countries, but that corporate and capital taxes in Latvia are the lowest among OECD countries.
"We cannot take the path to Latvia having the lowest taxes in all groups," Rutkaste said, adding that financing is needed to ensure the functioning of the state.
Rutkaste said that perhaps the labor taxes could be cut at the expense of some other tax but that such a measure would be reasonable in the situation of high unemployment, which is currently not the case.
Previously, Finance Minister Arvils Aseradens (New Unity) told LETA that the government coalition would get to work on tax policy guidelines as soon as Latvia's 2023 budget is adopted.