Latvia to impose a tax for banks

12:54 - 9.10.2024


October 9, Fineko/abc.az. The Latvian government has supported introduction of an additional income tax on financial organizations for the next three years to cover defense costs, ABC.AZ reports, referring to the Ministry of Finance of Latvia.

"This law will help find additional resources to meet the financial needs of the state in the field of national security," said Latvian Finance Minister Arvils Asheradens.

The new measure to affect the net interest income of banks is expected to attract extra 93 million euros to the budget in 2025 and 85 million euros each in the next two years. At that, institutions that increase the volume of lending will be able to reduce the tax rate, the Miistry says.

The Sejm (Parliament) of Latvia must approve the bill before it is submitted to the country’s president Edgars Rinkevics for signature, Bloomberg adds.

In June, the head of the Latvian Defense Ministry, Andris Spruds, said that the country would bring defense spending to 3% of GDP in 2024.