The State Revenue Service (VID) will face a 10% budget cut and a 13.2% staff reduction next year, VID Director General Baiba Šmite-Roķe announced on Friday at a media briefing.
She emphasized that VID faces a difficult challenge — maintaining the same functions with fewer resources.
Šmite-Roķe noted that the VID’s base budget for the current year had already been reduced by 4%, from €163.6 million to €156.8 million. For 2026, the VID budget will decrease by €15.7 million (10%) to €121.2 million, including the budget of the Tax and Customs Police (NMP) of €19.7 million, which will become a separate institution under the Minister of the Interior.
According to Šmite-Roķe, remuneration at VID will fall by 9%, at NMP by 7%, IT expenses by 8%, and other expenses by 11% next year.
VID Support Department Director Antra Gremzde, who will become the Deputy Director General and Head of the Administrative Department next week, explained that
the cut to the information and communication technology (ICT) budget will not affect development
or security projects.
She said ICT expenses will decrease by €2.6 million, including €2 million for adapting information systems. Going forward, if legislative changes require system adjustments, the necessary financial resources must be provided in the law itself.
There will also be a €330,000 reduction in process improvement spending, with greater reliance on artificial intelligence, and a €250,000 reduction in workplace equipment — including computers, printers, telephones, and Microsoft Office licenses.
From now until 2029, VID’s ICT development will rely on EU Regional Development Fund projects totaling €20 million, including €11 million earmarked for the third phase of the E-Customs system.
Other operational expenses will be reduced by €2.4 million in 2026, Gremzde said.
A reduction in office space will save €675,000, as VID will destroy a large number of files belonging to liquidated taxpayers stored in archives. Rental payments to State Real Estate (VAS “Valsts nekustamie īpašumi”) will also be reduced.
Additional savings include €505,000 on business trips, training, and translation, €227,000 on ceremonial uniforms, and €549,000 on customs equipment maintenance, as technological systems will no longer be maintained at Silene and Vientuļi border checkpoints, which remain closed. There are currently no indications that these checkpoints will reopen.
Savings will also include €200,000 from the vehicle fleet, €155,000 on office supplies and services, and €130,000 on excise stamps due to reduced demand.
Gremzde added that
VID must still assess the risks posed by such budget cuts.
Šmite-Roķe said that a large part of the savings will come from reducing staff positions. This year, VID’s headcount was already reduced by 93 positions — from 3,688 to 3,595 employees.
“We don’t have much room to save on operational costs, so we must reduce staff,” Šmite-Roķe said. “We reviewed the efficiency of functions and identified administrative burdens that could be eliminated. Many long-standing procedures were outdated — we can save time and effort by asking businesses for fewer documents.”
She also noted that VID reviewed risk thresholds, for example, introducing automatic VAT refunds up to a certain limit without manual review. Positions tied to support functions were also reduced.
VID is now preparing legal amendments to remove functions and procedures that do not justify their costs
or pose low financial risk. Digital services were also reviewed to determine whether they have reduced administrative burdens as intended.
Šmite-Roķe said the number of employees would be reduced by 393 positions next year — to 2,820 by 2026. The newly independent Tax and Customs Police will employ 382 staff.
Next year, 98 vacant positions and 54 managerial posts will be eliminated. Employee evaluations are underway and will continue until the end of November.
According to Šmite-Roķe, the reduction will drive digitalization, process automation, functional consolidation, and risk-based supervision in tax administration, along with expanding the “Consult First” service model digitally.
However,
she warned of risks: lower tax collection, reduced service accessibility, a potential rise in the shadow economy,
employee overload and demotivation, and the failure to achieve VID’s strategic goals.
All identified risks will be monitored, with algorithms designed to mitigate them if they grow significantly, she said.
“The first few months of next year will be difficult,” Šmite-Roķe admitted, “but I believe this is the path the entire public administration must take.” She expressed particular concern about the reduction in customs staff, warning that some customs officers may need to be rehired after a few months.
Customs Administration Director Raimonds Zukuls said the customs budget will decrease by €2.46 million, with 105 positions eliminated, including nine managerial roles — roughly half of them currently vacant.
Zukuls expressed concern that the cuts could weaken border control,
explaining that several 24-hour customs checkpoints (MKP) will operate only during day shifts (8:00–20:00). Eastern border points will remain open 24/7.
At Rēzekne II and Daugavpils freight stations, customs checks for trains will now take place only during daytime hours. Zukuls acknowledged there is a risk of congestion, though freight traffic is expected to decline significantly.
He added that customs will review its risk appetite, leading to longer customer service times, and warned that business costs may rise since goods not cleared by 20:00 will have to be processed the next day.
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