The amount of natural resource tax to be paid during the construction of the main line of the Rail Baltica railway could exceed five million euros, according to information provided by the Ministry of Transport to the Saeima’s Economic, Agricultural, Environmental and Regional Policy Committee.
The ministry explained that the preliminary amount of the natural resource tax has been calculated along the entire length of the main line, taking into account that there are 67 construction permits along the route. According to 2025 data, a total of 82,273 euros in tax was calculated and paid during the third and fourth quarters.
The Ministry of Transport indicated that the payment of the natural resource tax within the Rail Baltica project remains an unresolved issue. As an example, the ministry noted that soil, sand and excavated materials removed in one construction permit area and transferred to another construction permit area, as well as their storage, accounting and taxation or exemption from taxation, occur in all cases where the materials remain within the Rail Baltica project territory.
The Ministry of Transport added that it is now clear that a very significant volume of excavated soil, sand and other materials will be moved during the implementation of the Rail Baltica project. Given that a large part of these materials will be reused within the project, under the currently applicable regulations the project implementer may still be required to pay natural resource tax.
Therefore, on Wednesday the
Ministry of Transport submitted a proposal to the committee stipulating that no natural resource tax should be applied
to the extraction of natural resources within the construction territory of the Rail Baltica railway infrastructure and related structures, nor to the movement of natural resources within the boundaries of immovable properties included in the project’s construction sites or between multiple construction sites, where such movement is necessary to ensure construction.
Representatives of the Ministry of Climate and Energy pointed out during the meeting that these proposals have a fiscal impact and that no compensatory mechanisms are currently in place, therefore broader discussions with the Ministry of Finance will be required.
The committee decided to partially support the Ministry of Transport’s proposal on exempting the natural resource tax and to refine it for the third reading.
At the same time, after several meetings, the committee decided to advance proposals for the second reading in the Saeima regarding amendments to the Rail Baltica project implementation law, which aim to strengthen project governance,
including defining the areas of responsibility of other ministries in the implementation of the project.
Members of Parliament supported a jointly developed proposal stipulating that the Prime Minister is responsible for coordinating the implementation of the Rail Baltica project within the Cabinet of Ministers and ensuring cooperation between the involved ministries. Meanwhile, the Ministry of Transport will develop transport sector policy for the implementation of the Rail Baltica project, lead the project’s implementation, monitor its progress and coordinate its execution.
It is also planned to determine that the Ministry of Finance is responsible for developing and supervising the strategy for attracting financing for the Rail Baltica project, identifying and securing funding sources, as well as monitoring fiscal risks related to the financing of the project.
The proposals stipulate that public administration institutions cooperate with institutions involved in the implementation of the Rail Baltica project and, within their competence, provide consultations on the application of regulatory frameworks, as well as represent Latvia’s national interests abroad and in international organisations
in order to ensure the successful implementation of the project and other related tasks.
The proposals also stipulate that the Ministry of Foreign Affairs will provide support and proposals for coordinating international cooperation related to the Rail Baltica project, including cooperation with countries involved in the project, European Union institutions and other foreign institutions, as well as in the conclusion of intergovernmental agreements related to the implementation of the project.
The Ministry of Justice will provide support in developing the regulatory framework concerning the registration and expropriation of immovable property rights necessary for the implementation of the project. The Ministry of Climate and Energy will provide support and proposals regarding the development of electricity supply infrastructure necessary for the project, as well as in the planning, evaluation and implementation of climate and energy projects financed by foreign and other financial instruments.
The Ministry of Defence will provide support and proposals related to national defence and military mobility issues associated with the implementation of the Rail Baltica project. The Ministry of Smart Administration and Regional Development will provide support in matters related to environmental protection, regional development and digital services.
The Ministry of Economics will provide support and proposals in the development and coordination of regulatory frameworks in the construction sector, ensuring efficient and proportionate administrative processes in construction,
as well as attracting foreign investment to the Rail Baltica project and promoting export capacity and external trade.
The Ministry of Education and Science will provide support for the preparation of specialists necessary for the implementation and operation of the Rail Baltica project and promote the involvement of scientific institutions in research and innovation development related to the project.
The amendments stipulate that the Prime Minister and the Minister of Transport must report to the Saeima on the progress of the Rail Baltica project at least twice a year.
The committee also conceptually supported a proposal that the State Chancellery, together with the responsible committees, must by the 1st of July, 2026 conduct an audit of the accessibility status of Rail Baltica project documents and information, and ensure the revision of this status and the publication of documents where the restriction period has expired or the restriction is no longer necessary.
The Parliamentary Secretary of the Ministry of Transport, Kristaps Zaļais, indicated that the Ministry of Transport has declassified several project-related documents in recent years and will continue to do so.
The committee decided to advance the Rail Baltica implementation law to the second reading in the Saeima.
As previously reported, the Rail Baltica project implementation law entered into force in November 2022, and therefore decisions regarding the project’s scope and governance need to be updated. The Trans-European Transport Network regulation and the European Commission implementing decision provide that the first phase of the Rail Baltica project must be completed by the 31st of December, 2030, while the Cabinet of Ministers’ decision on the scope of the first phase no longer includes the connection of the Rail Baltica route to Riga.
Thus, the draft law clarifies that in the first phase it is necessary to ensure a functional cross-border railway infrastructure connection of the Latvian section with Estonia and Lithuania, while in the second phase the remaining scope of the Rail Baltica project in Latvia must be implemented.
Taking into account government decisions, the implementation of the Rail Baltica project will proceed according to available funding. The draft law stipulates that the railway infrastructure of the Rail Baltica project will ensure dual use — both for civilian transport and for the transportation of military personnel and cargo.
Considering the nature of the project, including the construction of assets to be transferred to municipalities,
it is planned that the project may be financed not only from European Union financial instruments and the state budget, but also from other sources, including loans from financial institutions, municipal budget funds, private financing, donations and grants.
The Ministry of Transport explains that such additional financing sources may be used only if they do not negatively affect the general government budget balance or if any negative impact is compensated, and if financing is ensured in accordance with the Fiscal Discipline Law and European Union fiscal rules.
The draft law also establishes that the railway infrastructure and related structures built during the implementation of the Rail Baltica project will belong to the Latvian state, represented by the Ministry of Transport.
Rail Baltica public-use railway infrastructure is classified as an object of national interest.
Therefore, information on the infrastructure and the territories required for its functioning is included in the Territorial Development Planning Information System.
Public consultations are not planned for the construction of Rail Baltica public-use railway infrastructure and related structures, as additional conditions arising from such consultations may delay and complicate construction.
Environmental procedures related to the construction of the railway infrastructure may be carried out simultaneously with design works, but no later than the completion of design conditions within the already initiated construction process.
It has been reported that the first phase of the Rail Baltica project in the Baltic states could reach 14.3 billion euros, including approximately 5.5 billion euros in Latvia, which could increase to six billion euros after indexation.
Total project costs could reach 23.8 billion euros,
compared to an earlier estimate of 5.8 billion euros in 2017.
The Rail Baltica project aims to establish a European standard-gauge railway line from Tallinn to the Lithuanian–Polish border, enabling the Baltic states to be connected to other European countries by rail. In the Baltic states, it is planned to construct a new 870-kilometre European standard-gauge railway line (1435 millimetres) with a maximum train speed of 240 kilometres per hour.
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