On Thursday, the Saeima adopted in the final reading the Law on Limiting the Increase in Fuel Prices, which provides for temporary measures to mitigate the impact of rising fuel prices on the national economy and residents.
The amendments were adopted by Saeima deputies in a single day, initially supported conceptually with a proposal submission deadline of just five minutes, which sparked outrage among opposition deputies. Before the second reading, the Saeima Budget and Finance (Taxation) Committee was convened to review the submitted proposals.
Opposition deputy Ramona Petraviča (Latvia First Party) had submitted a proposal which, according to her, would reduce diesel fuel prices by approximately 16 cents, namely by lowering the tax to the minimum permissible level of 330 euros per 1,000 litres.
A representative of the Ministry of Finance, speaking at the Saeima Budget and Finance (Taxation) Committee before the second reading, emphasized that the decision must be fiscally neutral and that applying the minimum rate would not guarantee fiscal neutrality. The committee rejected the deputy’s proposal, and immediately after the vote Petraviča left the committee meeting room.
Opposition deputies criticised the government’s proposed fuel price reduction during the debates,
arguing that it was too small. “If the price of fuel increases by seven cents within a day, then tell me what exactly these eight cents will save. Will it save the state budget?” asked the deputy, questioning why all available instruments were not being used to provide support at such a moment.
Another opposition deputy, Svetlana Čulkova, stated that the draft law was merely an imitation of work. “Almost all deputies receive compensation for their fuel, but ordinary people will be allowed to reduce their expenses by only eight cents,” Čulkova complained.
Meanwhile, opposition deputy Andris Kulbergs (United List) noted that it was positive that the government had reacted, but the issue lay in the speed of the response. “Speed is the issue, and therefore this package must be delivered quickly. A delay of a month will already cause damage with long-term consequences,” Kulbergs said, adding that the government’s proposal was not genuine support but effectively additional government profit.
“The state will earn excess profit from all vehicles in the country — from entrepreneurs and residents
— generating unplanned additional revenue,” the deputy said, noting that it would be necessary to follow Poland’s example and reduce the impact also through the value added tax.
Despite opposition criticism, the amendments in the second, final reading were supported by all 94 deputies present at the Saeima session.
“This is a balanced decision that helps to reduce cost pressures on businesses while strengthening economic stability. At the same time, the overall level of budget revenues is maintained,” said Anda Čakša (New Unity), Chair of the Budget and Finance (Taxation) Committee responsible for advancing the draft law.
The law provides for a temporary reduction of the excise duty on diesel fuel
— from the current 467 euros to 396 euros per 1,000 litres. For marked diesel fuel used in agriculture, the excise duty rate is set at 21 euros per 1,000 litres. The reduced rates will apply from the 1st of April to the 30th of June.
The aim of the adopted regulation is to mitigate the negative impact of rising fuel prices on household expenses, business costs, and the overall level of inflation. Rising fuel prices significantly affect the costs of transport, logistics, and other sectors, creating a further ripple effect on the prices of goods and services.
The adoption of the law is linked to a significant increase in fuel prices on international markets, caused by geopolitical developments and disruptions in oil supply chains. In recent weeks, a sharp increase in oil and diesel prices has been observed, directly affecting the Latvian market due to the high share of imported fuel.
Given the development of the situation, the Cabinet of Ministers has developed a temporary solution that allows for a prompt response to price fluctuations while maintaining balance in the state budget. The reduction of excise duty will partially offset price increases and help stabilise the economic environment.
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