Latvia: Alcohol Taxes Boost Culture
The Latvian government is set to revive a tax system that collects revenue from taxing alcohol, tobacco and gambling at higher rates to fund its State Culture Capital Foundation. New taxes will be introduced in order to raise much-needed revenue for culture across the country.
Under the new taxation system, alcohol, tobacco and gambling taxation will be raised. The State Culture Capital Foundation will thus receive 3% of an excise alcohol tax, 2% of an excise tobacco tax, 2.21% of a gambling tax, and 1.37 of a tax on lottery operations. The new regime is set to come into force in 2022.
These proceeds will be used to enhance funding for different cultural projects, events and activities in Latvia. The foundation will mainly use the new revenue contributions in three ways:
- To organize three culture project competitions per year,
- To fund different cultural events that benefit children and youths,
- To provide between 10 and 20 lifelong scholarships,
Similar systems are in place in neighbouring Baltic countries, Lithuania and Estonia.