Latvia's new President Egils Levits vowed to tackle income inequality in the Baltic eurozone state as the Soviet-era dissident and former judge at the European Court of Justice was sworn into office on Monday.

"We all know that Latvia is among the most unequal countries in the European Union, an illness we have had for many years," Levits, 64, told parliament, which elected him by a majority of 61 of 100 lawmakers in May.

"Two parallel Latvias are developing in some respects," he added, urging cross-party cooperation on the creation of "long-term solidarity policies" such as progressive taxation to narrow the gap between rich and poor.

The European Commission's latest country report for Latvia said that in 2018 "the income of the richest 20 percent of the Latvian population was 6.8 times higher than that of the poorest 20 percent; a significantly more uneven distribution than in the EU as a whole".

Touching on foreign policy, Levits rejected the idea of Latvia being "a bridge" between East and West, insisting the formerly Soviet-ruled country of 1.9 million people was instead an "integral part of the Western world and Europe".

Latvia joined NATO and the EU in 2004 after breaking free from the crumbling Soviet Union in 1991. It went on to join the eurozone in 2014.

The Latvian president holds a largely ceremonial post, but he is commander-in-chief of the armed forces and appoints the prime minister and ambassadors.

The head of state also has the right to propose and return legislation to parliament, as well as to dissolve parliament.

Levits and his parents, anti-Soviet dissidents of Jewish, Latvian and Baltic German origin, were expelled from the Soviet Union in 1972 because the KGB viewed them as a threat to the Communist regime.

The family settled in Germany where Levits obtained law and political science degrees. Levits returned to Latvia in 1990 to take up politics as the country shed Soviet rule.

In 1995, he was appointed to the European Court of Human Rights before becoming a judge at the European Court of Justice in 2004.

He replaces outgoing president Raimonds Vejonis, who did not seek a second term.