«The public claim from the prime minister that residents in Latvia sustain entrepreneurs from their taxes is completely false, offensive to entrepreneurs and only serves to divide society. Considering the fact that the state budget primarily receives money from entrepreneurs and their teams, I would like to invite the PM to publicly apologize to all entrepreneurs for this offensive and false claim,» says the president of Latvian Chamber for Commerce and Industry (LTRK) Aigars Rostovskis.
In an interview to LTV programme Rīta panorāma, Latvian Prime Minister Krišjānis Kariņš, commenting on the invitation from the Tourism Crisis Management Committee to dismiss Minister of Finance Jānis Reirs and Minister of Health Daniels Pavļuts, said: «Society cannot continue sustaining entrepreneurship, especially if it is not it high demand.»
After this claim LTRK president said: «This started with beliefs as to where the money comes from. This money does not appear in the state budget out of nowhere – the money comes from entrepreneurship, mostly from companies engaged in exports. Exporting companies sell their goods and services abroad and attract money for the state budget in foreign countries. Companies active on the domestic market create jobs, produce goods and services, and therefore – money. Since money is the product of market relations – if there are no entrepreneurs and entrepreneurship, there is no money to distribute to the state budget and finance state functions.»
At the same time, he says all the money that ends up in ministries, hospitals, schools and other state institutions came from entrepreneurs, because the public sector does not generate money on its own. Although taxes are accounted for public sector workers, they mostly work with existing financial resources and do not generate any on their own. The money previously generated by entrepreneurs goes through these tax loops, but no more. This is why the claim that society sustains entrepreneurs with their taxes is completely wrong. The money generated by entrepreneurs is what is used to provide support in tough times.
Rostovskis also stresses that in the last two years spent in the shadow of the pandemic, the state has imposed unreasonable restrictions on entrepreneurs, especially in sectors that have suffered the most, such as the tourism and accommodation sectors. At one point the head of the government said entrepreneurs are not allowed to work, and at another point – that the state cannot afford to sustain enterprises in different sectors. From the very start of the pandemic LTRK has stressed that all decisions should be carefully considered and balanced.
«The crisis is present not only in healthcare – the crisis is present across all sectors of entrepreneurship. Two years is a long enough period of time to come up with solutions and make rational decisions.»
For a long time LTRK has been trying to convince the government to let entrepreneurs work while making sure the virus does not enter their premises. However, the restrictions imposed thus far remain unjustified and unreasonable.
In other European countries industries are starting to return to their pre-pandemic state. Companies are allowed to work and industries are moving forward, because restrictions are more flexible and balanced. This means those countries have no need to invest their budget money into supporting entrepreneurs – they find money on their own, explains LTRK.
«Our country’s leaders should return to economic basics and look back at where the money comes from. They should also educate residents about it. Considering that entrepreneurs and their teams are the ones who earn money for the state budget, the prime minister should publicly apologize to entrepreneurs for offensive and false claims about society sustaining entrepreneurs,» says the president of LTRK.
Entrepreneurs: Latvian PM should apologize for making false claims
