Valainis: Impact of fuel prices on economy has decreased
Economics Minister Viktors Valainis says the impact of fuel prices on Latvia's economy has decreased as global prices fell by 30-40%, but the situation remains unstable. The government has no plans to change tax policy and will keep existing support mechanisms.
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Economics Minister Viktors Valainis (ZZS) stated on Tuesday after a closed government meeting that the impact of fuel prices on Latvia's national economy has diminished. He noted positive trends in global markets, with price peaks dropping by approximately 30% to 40%. However, the minister emphasized that markets remain unstable due to ongoing geopolitical tensions.
Valainis said that given the pressure from previous months, the government concluded that no changes to tax policy are currently needed. Discussions on support instruments included proposals to abolish some mechanisms, but an agreement was reached to retain them, as the impact of fuel prices on the economy is long-lasting.
On April 1, the Fuel Price Increase Limitation Law came into effect, reducing excise tax on diesel from €467 to €396 per 1,000 liters. For marked diesel used in agriculture, the excise rate is set at €21 per 1,000 liters. On June 18, the Saeima adopted amendments extending the reduced rate until the end of this year.
