Tax, pension system reforms adopted by Lithuanian parliament

Source: Xinhua| 2018-06-29 03:09:55|Editor: Mu Xuequan
Video PlayerClose

VILNIUS, June 28 (Xinhua) -- The Lithuanian parliament adopted on Thursday tax and pension system reforms which are both aimed, according to the government, at increasing citizen revenues.

The reforms are yet to be approved by the country's president Dalia Grybauskaite.

"My team and my advisers are working together with the ministry of finance and the parliament. We are ready to review everything on Friday and if everything goes well, I will sign the laws this Saturday," Grybauskaite was quoted as saying by local radio broadcaster LRT as regards the tax reform.

However, she underscored that the law on the pension reform would be reviewed only next week.

Both reforms were adopted by the parliament with the end of its spring session approaching. If the president okays the changes, the laws would take effect on Jan. 1, 2019.

According to the personal income tax reform, personal income tax rates in Lithuania will vary from 20 to 27 percent.

In 2019, a 20 percent tax rate would apply to annual income below the threshold of 107,000 euros per year or 8,950 euros per month. Meanwhile, income exceeding this threshold would be taxed by a 27 percent rate in 2019.

The parliament also approved the proposal to gradually increase the tax-exempt amount of income as of 2019.

In a separate move, the parliament adopted the changed to the Law on the Accumulation of Pensions, under which the Sodra (State Social Insurance Fund Board) would no longer make its contributions to private pension funds, and residents' automatic inclusion into the pension accumulation system would be introduced.