Lithuanian parliament speaker sceptical about cutting VAT to alleviate Russian import embargo effects

Loreta Graužinienė
DELFI / Kiril Čachovskij

According to the Seimas speaker, there will be much discussion in the Government regarding reduced VAT rates for certain products. Graužinienė says she would be inclined to seek realistic ways to assist businesses by deferring advance payments or payments to the State Social Insurance Fund Board (SoDra).

Graužinienė spoke favourably of intervention buying but said that this was a short-term measure in order to stabilise processes in the market.

The head of the Seimas hopes that the final measure plan will be approved next week, that the decisions will be adopted promptly and that it will not take six months as some businesspeople fear.

Talking about ritual slaughter of farmed animals, Graužinienė says she hopes that members of Parliament will manage to adopt the amendments to the Law on Welfare and Protection of Animals.

“If the Government submits its conclusions this week, perhaps they (the Committee on Rural Affairs – ELTA) will manage to complete all deliberations and procedures, so we can adopt amendments on 10 September, if there is enough political will in the Seimas. I would like to note that the law was submitted once but was not supported in Parliament. At the time, discussion over humanity rather than economic necessity prevailed. Perhaps this time there will be more foresight,” said Graužinienė.

According to her, the State Tax Inspectorate (VMI) is carrying out calculations how much the state budget will lose because of the Russian embargo on food imports. The impact on the country’s gross domestic product (GDP) is said to have been calculated, whereas work on revenue collections and other financial flows is continuing.

Talking about promoting consumption, the speaker highlighted the increase of certain payments and salaries.

As reported, reduced VAT rates of 5 or 7 percent for vegetables and meat are considered as a measure to relieve the effects of the embargo for Lithuanian produce.

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