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Lithuania’s new government to only approve ‘beneficial’ VAT breaks

Rimantas Šadžius
Juliaus Kalinsko / 15min nuotr. / Rimantas Šadžius
Šaltinis: BNS
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Lithuania’s new government will only introduce reduced VAT rates for food products once it is certain that they will have “positive effects”, says Rimantas Šadzius, the finance minister-designate.

A VAT relief on books and publishing, which, according to Šadzius, sends a social message, does not cost much for the budget. However, VAT breaks on foodstuffs is “something different”.

“Will the reduced VAT rates for food products, which will truly cost a fortune for the budget, actually drive the prices of food products down? Will this measure actually force a certain share of trade to move from marketplaces to the legal zone, such as the shopping centers? This should be assessed through studies and the decisions should only be adopted once the result of these studies is convincing enough,” he told MPs on Tuesday.

Lithuania’s traders said in late November that they were ready to lower the prices of meat and poultry by the rate matching the cut in the VAT levied on those products.

The new government intends to apply reduced VAT rates on certain necessary foods, on hotel and performer services, intellectual production.

BNS
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