Latvia needs to maintain the state budget deficit at 2.8-2.9% of GDP this year, said Minister of Finance Arvils Ašeradens in an interview to LTV programme Rīta panorāma.
The minister stressed that the issue of year’s budget deficit is very important, because the European Commission (EC) for Eurozone’s financial management. This new mechanism will not only focus on the matter of deficit but will also set a new management mechanism for member states – it will establish the right for member states to increase or decrease costs for the next four years.
“If the deficit exceeds 3%, we may end up in a situation when we might have to reduce expenses in the next four years – it will be the so-called deficit reduction procedure. This is why I am very serious about this,” said Ašeradens, adding that this year’s budget deficit should be maintained at 2.8-2.9% of GDP this year.
The Latvian minister also said the current situation is being monitored very carefully because economic growth forecasts are being lowered.
Inflation continues going down as well. “Right now I am cautious about whether or not our tax revenue meets our expectations,” said the minister.
Ašeradens also mentioned that the labour tax revenue in the first months was very good. However, revenue from value added tax is not looking very good.
As previously reported, the consolidated budget revenue for 2024 is planned at nearly EUR 14.5 billion. Expenditures are planned at slightly above EUR 16.2 billion. The general government budget deficit is planned at 2.8% of GDP.
Also read: Tet: state loses tens of millions of euros to illegal data transmission
Follow us on Facebook and X!