Latvia: Government to raise minimum wage, change tax rates

The Latvian government plans to raise the country’s minimum wage in 2025, Finance Minister Arvils Aseradens announced, LETA reports. Under the minimum wage algorithm, the monthly minimum wage will rise to EUR 740 in 2025, EUR 780 in 2026, EUR 820 in 2027, and EUR 860 in 2028. Currently, the minimum wage stands at EUR 700 per month. Also, the government plans to raise the tax-free income threshold to EUR 510 in 2025, EUR 550 in 2026, and EUR 570 in 2027 and 2028. The threshold now applies to annual income of up to EUR 1,800 at a progressively reduced rate. Moreover, the government plans to introduce two fixed rates of personal income tax, including 25.5% for income up to EUR 8,775 per month and 33% for income above EUR 8,775 per month. An additional rate of 3% will apply to all income above EUR 200,000 per year.