The maximum annual salary amount from which social insurance contributions can be made will be LVL 32,600 or EUR 46,400 as of the year 2014, the government decided today by approving the Welfare Ministry's amendments to the regulations on social insurance contributions, informs LETA.

This means that the ceiling on social contributions will be restored in Latvia next year. Social contributions were capped from 1997, but the ceiling was lifted temporarily in 2009 in order to increase social insurance budget's revenue. This also meant, in turn, that high-income residents earned the right to impressive benefits and pensions.

From January 1, 2014, the maximum amount of social contributions per one person will be LVL 11,113.34 or EUR 15,817.76 a year.

Therefore, if a person is paid LVL 34,000 a year, he or she will only make social contributions from LVL 32,600. To the remaining amount, only personal income tax will apply.

Last year, there were 4,259 persons in Latvia whose annual salary exceeded LVL 32,600 – this is 0.4 percent of all insured persons in Latvia, according to the State Social Insurance Agency's data.