Proposed tax on bank assets criticised by government leaders

The proposal, however, has led to criticism from Prime Minister Algirdas Butkevičius and Minister of Finance Rimantas Šadžius.

According to Butkevičius, the proposal was a populist move designed to curry favor ahead of the Seimas elections.

“Do you know what bank assets are?” Butkevičius asked BNS. “They primarily consist of loaned money – people’s deposits. If bank assets in general would be taxed, everything would be transferred to people’s deposits – the interest rates for deposits will be smaller or even negative. Banks own 8-12 percent of their assets.”

Šadžius explained that the proposal had to be analysed according to EU law. “If [the proposal] will violate European Union law – because, of course, the country could adopt this law, but it will be appealed to the European Court of Justice, and once the case is lost, [Lithuania] may incur financial losses,” he said.

The EAPL says that the income from such a tax could go to pensions and increased stipends for children and families with many children.

According to EAPL member and Seimas Budget and Finance Committee member Rita Tamašiūnienė, the proposal has not yet been registered and is still being discussed with specialists and legal experts for its potential effects on business and on the budget. “This shouldn’t be a tax that ends up on consumers’ shoulders,” she said. “There must be safeguards to prevent that from happening.”