Finance and insurance
The Latvian tax system has not generally changed, but from time to time the government decides on changes in some taxes when drafting next year’s budget. In order to end this practice, the government has resolved to prepare and introduce a new tax policy – transfer the tax burden from laborforce to capital.
Although the Latvian economy was growing a little slower than anticipated in 2016, the financial market resisted the overall trend and proved its continuing stability. Last year, Latvian commercial banks continued to pursue their development strategies, and main banking indices improved.
The number of employed persons in Latvia was 895,000 or 61.8% of the population aged 15-74 years in the third quarter of 2016The registered unemployment level was at 9.5% of the economically active population in the third quarter of 2016Unemployment in 2020 is planned at 8.2% (the Finance Ministry projects)
As the economic situation stabilised and growth resumed after the crisis, the banking sector returned to profitability in 2011/12.
The level of unemployment and its structure
The tax system of Latvia is not the simplest one, however, it cannot be considered as very complicated in comparison to the old EU Member States. Problems hitherto have been created by protracted changeability in the tax system, which the government has promised not to allow in the.
The Estonian taxation system has some advantages for the foreign investor.
Lithuania, similarly to neighboring country Latvia, struggling with state budget deficit, started to undertake tax changes in 2012.
The health care system in Latvia is currently experiencing significant difficulties. However, private business in this industry, as well as in pharmaceuticals, is profitable and gainful.
The financial services sector in Latvia suffered most gravely from the crisis: losses of the banking sector for two years have "eaten away" profits for the previous five years. The number of bad loans has increased, including outstanding loan liabilities.