As V. Mitala points out in a letter to the Ministry of Finance, most countries of the European Union (EU), when submitting their national plans to receive EU funds, have also assumed obligations in the tax area, but unlike Lithuania – mainly only in the tax area. areas of environmental protection and innovation-related taxes. Apart from Lithuania, only France has undertaken to modify the property tax (to change the tax procedure and not the tariffs), only five countries have undertaken to modify the income tax, with the exception of Lithuania .
“In Lithuania, the Ministry of Finance, without foundation, has voluntarily assumed obligations on behalf of the Seimas before the European Commission regarding the decisions that the Seimas will have to take in the future.
Therefore, we found ourselves in an unenviable position – when the tail wagging the dog. The tax reform, which will not achieve significant results, is pushed only because of the commitments made by the ministry, which wishes to receive funds from the EU. Neither Latvia nor Estonia included tax change indicators like Lithuania to receive FRR funds.
Today, these countries are winning: with economic uncertainty and war in Europe worsening the investment climate in the region, fiscal stability is a value. As a result, the Ministry of Finance should seek to modify the obligations assumed on behalf of Lithuania”, assures V. Mitalas.
The eldest of the Liberty party invites the Ministry of Finance to take the initiative to renegotiate with the EC the indicators set for the tax proposals. Currently, the Freedom Party has registered eight tax reform proposals. The Seimas will return to this in the autumn session.
The tax proposals submitted to the Seimas by the Ministry of Finance are linked to the obligations to benefit from financial support under the European Recovery and Resilience Facility (ERF). In order to obtain these funds, Lithuania prepared the “New Generation Lithuania” plan.
2.225 billion has been allocated to Lithuania to implement the projects included in the plan with RRF funds. for grants and up to 3 billion For loans in EUR. Funding is allocated taking into account Lithuania’s progress against 191 indicators that the government has agreed with the European Commission.
There are 6 essential indicators related to tax reform in the plan, their value is 577 million. EUR, the results of which were achieved thanks to ~120 million. Allowance of EUR.
ELTA recalls that the package of revision of the tax system, which caused many debates, was approved by the Seimas at the end of June after its presentation.
Critics of the reform were voiced in a joint statement by 54 trade and professional associations. The economic structures that prepared the appeal to the factions and committees of the Seimas urge parliament to reject proposals to increase personal income tax, arguing that the tax increase would worsen the country’s business environment , would harm Lithuania’s competitiveness and encourage the underground economy.
The tax reform presented by the government provides for higher taxes for some of the self-employed. Once the amendments are passed, more people would have to pay property taxes, the procedure for applying for certain benefits would be changed and a minimum unemployment benefit would be introduced.
According to Finance Minister Gintare Skaistė, 800,000 people would benefit from the reform, thanks to the increase in the amount of non-taxable income. population or 70 percent of all workers in the country, whose income amounts to an average wage. At that time, the tax burden, after changing the personal income tax model, would increase by about 17,500 people. individuals working individually.
Source: The Delfi