As reported, the Latvian Union of local authorities (LSS) has sent the budgetary-financial Commission of the diet the letter with the request with the adoption of amendments to the personal income tax from the population to provide that the total amount of tax revenues to the budgets of local governments was not less than 19.6 per cent.
LSS discusses several compensation mechanisms, and discussions on this matter continue.
In the document on the basic principles of tax reform, supported by the government on 9 may, contains a stipulation,
the Ministry of Finance to compensate for the impact of tax reforms on the budgets of local governments have provided special mechanism for subsidies.
The subsidy must be such that the total tax revenues of local governments together with the special subsidy amounted to 19.5% of revenue total budget.