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Latvijas Balzams not provided with CIT discount worth 4.24 million euros

Publicity photo.
On Tuesday, 26 September, Latvian Cabinet of Ministers decided to postpone the decision regarding the proposal to provide Latvijas Balzams with a corporate income tax discount worth EUR 4.24 million for the realization of a large investment project.

It is stated in Latvijas Balzams’ unaudited report for the first six months of 2017 that the company has commenced a major modernization and reconstruction project to combine two production plants under one roof.

«Completion of the project will result in increased competitiveness among the region’s producers. The project will also help reduce labour, logistics and production costs,» as noted in the report. The total cost of the project, according to available information, is planned at EUR 23 million.

The company has turned to Economy Ministry with a request to be provided with CIT for the project. The ministry prepared and submitted to the government a proposal to support Latvijas Balzams project with a long-term investment for a total amount of EUR 16,964,143 and provide it with status of supported investment project.

The proposal also includes the provision of a CIT discount of 25% from the initial long-term investment amount, but no larger than EUR 4,241,036.

As it is known, Latvian government has been providing CIT discounts to different businesses for different investments since 2012. So far discounts have been provided to nearly 30 companies, including Dobeles dzirnavnieks, Baltic Crystal, Tērvetes AL, AKG Thermotechnik Lettland, Olainfarm, Latvijas mobilais telefons, Latvijas finieris, Bite Latvija, Cross Timber Systems, Livonia Print, Plantos, Rīgas piena kombināts, Aduga, Alfa agro, Rīgas elektromašīnbūves rūpnīca, Valmieras stikla šķiedra and others.

According to data from Economy Ministry, projects worth a total of EUR 355.1 million have been realized and discounts worth EUR 79 million have been provided since the introduction of the CIT discount programme. Investment project realized with assistance from the government have created more than 1,200 new jobs.


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