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SRS publishes employers who pay minimal or below minimal wages

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Latvia’s State Revenue Service (SRS) has published a list of employers who pay minimal or below minimal wages to their employees.  A total of 2,604 employers are on this list.

Information about employers who pay minimal and below minimal to their employees has been made accessible to improve overall security of the business environment, honest competition and compliance with tax payment commitments.

According to results of Grey Economy Index in Baltic States 2009-2016 performed by Stockholm School of Economics in Riga, the second largest proportion of grey economy in Latvia consisted of envelope wages (40.2%) in 2016.

SRS notes that results of this study show that smaller and relatively younger businesses are engaged in grey economic activities more often than larger and older businesses. This means businesses often use tax-avoidance schemes to reach a specific competition level to become successful on the market.

«Finally, tax avoidance and intentional non-disclosure of revenue in Baltic States is associated with the assumption that things get worse if you’re caught. Companies with a risk of being discovered using illegal schemes are less likely to get involved in grey economy,» SRS explains.

Considering that minimal wages in Latvia are not allowed to be below the minimum established by law, employers often state minimal wages in accounting documents and instead pay bonuses to hide official income.

At the same time, SRS notes that information accessibility about employers who pay minimal or below minimal wages will help protect the rights of employees and help them evaluate differences with wage offers before signing job contracts.

SRS will compile publicly accessible information before the 25th of every month.


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