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Krīzes un 2009. gada nodokļu politikas izmaiņu ietekme uz Latvijas ekonomiku
[Influence of the Crisis and 2009 Tax Policy Changes on the Latvian Economy]

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  • Skribans, Valerijs

Abstract

The paper discusses the influence of the global economic crisis on the Latvian economy. Using the system dynamics approach and models produced beforehand, various development scenarios of tax policy, householder crediting, and the job market are analyzed. Produced models allow to obtain effective change data in line with new development tendencies to check various hypotheses. Model results show that an increase of the rate of the value added tax (VAT) will cause not only the increase of VAT volume but also, by way of feedback, a decline in consumption. The VAT and excise tax volumes planned in the beginning will diminish in case of declining consumption. The VAT rate increase will allow for a short-time increase in income from taxes, but it will not have a protracted effect. A similar situation is with the excise tax. The reduction of the income tax rate diminishes the volume of income tax and, simultaneously, fosters consumption, which in turn causes VAT, excise and income taxes to increase again. 30% cuts of salaries will impede householders to pay their credits and the interest rates without reducing their other expenditures. Nevertheless, such a large salary cut is unreal. Migration of labour force will introduce the average salary slightly below that of the salary minimum in the more developed European states into the Latvian labour market.

Suggested Citation

  • Skribans, Valerijs, 2009. "Krīzes un 2009. gada nodokļu politikas izmaiņu ietekme uz Latvijas ekonomiku
    [Influence of the Crisis and 2009 Tax Policy Changes on the Latvian Economy]
    ," MPRA Paper 19141, University Library of Munich, Germany.
  • Handle: RePEc:pra:mprapa:19141
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    File URL: https://mpra.ub.uni-muenchen.de/19141/1/MPRA_paper_19141.pdf
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    References listed on IDEAS

    as
    1. Skribans, Valerijs, 2007. "Ekonomisko un vadības profesiju darba apmaksas tirgus konjuktūra Latvijā
      [Salary conjuncture of economic and management professions experts in Latvia]
      ," MPRA Paper 16384, University Library of Munich, Germany.
    2. Skribans, Valerijs, 2009. "Modelling crediting volume by using the system dynamic method," MPRA Paper 16353, University Library of Munich, Germany.
    Full references (including those not matched with items on IDEAS)

    Citations

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    Cited by:

    1. Skribans, Valerijs, 2011. "Development of System Dynamic Model of Latvia’s Economic Integration in the EU," MPRA Paper 34565, University Library of Munich, Germany.
    2. Skribans, Valerijs, 2010. "Development of the Latvian energy sector system dynamic model," MPRA Paper 25067, University Library of Munich, Germany.
    3. Skribans, Valerijs, 2010. "Latvijas energosektora sistēmdinamikas prognozēšanas modeļa izstrāde
      [System dynamic model development for the Latvian energy sector]
      ," MPRA Paper 23666, University Library of Munich, Germany.
    4. Skribans, Valerijs, 2011. "Разработка Модели Системной Динамики Для Энергетического Сектора В Латвии
      [Development of system dynamics model for the energy sector in Latvia]
      ," MPRA Paper 39251, University Library of Munich, Germany.
    5. Skribans, Valerijs, 2009. "Nodokļu ieņēmumu modelēšana, izmantojot sistēmdinamikas metodi
      [Taxes income modeling with system dynamic method]
      ," MPRA Paper 27096, University Library of Munich, Germany.
    6. Skribans, Valerijs, 2011. "Makroekonomiskā aprites modeļa izstrādāšana izmantojot sistēmdinamikas metodi
      [Development of System Dynamics Macroeconomic Equilibrium Model]
      ," MPRA Paper 34357, University Library of Munich, Germany.
    7. Skribans, Valerijs, 2010. "Latvia’s incoming in European Union economic effect estimation," MPRA Paper 32522, University Library of Munich, Germany.
    8. Skribans, Valerijs, 2010. "Разработка Модели Макроэкономического Равновесия С Использованием Метода Системной Динамики
      [Development of Macroeconomic Equilibrium Model with the System Dynamics Method]
      ," MPRA Paper 22716, University Library of Munich, Germany.

    More about this item

    Keywords

    nodokļu politika; kredītslodze; darba alga; darbaspēka migrācija; sistēmdinamika;

    JEL classification:

    • E22 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Investment; Capital; Intangible Capital; Capacity
    • E21 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Consumption; Saving; Wealth
    • A10 - General Economics and Teaching - - General Economics - - - General
    • C53 - Mathematical and Quantitative Methods - - Econometric Modeling - - - Forecasting and Prediction Models; Simulation Methods
    • E27 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Forecasting and Simulation: Models and Applications
    • E24 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Employment; Unemployment; Wages; Intergenerational Income Distribution; Aggregate Human Capital; Aggregate Labor Productivity
    • C40 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods: Special Topics - - - General
    • E00 - Macroeconomics and Monetary Economics - - General - - - General
    • E20 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - General (includes Measurement and Data)
    • C01 - Mathematical and Quantitative Methods - - General - - - Econometrics

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