Lithuanian gov't set to scrap planned bank assets tax

Source: Xinhua| 2019-12-06 01:42:02|Editor: yan
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VILNIUS, Dec. 5 (Xinhua) -- Lithuania's government will likely give up the idea to tax the assets of the country's banks and introduce an additional seven percent corporate tax for banks instead, local media reported on Thursday.

"This alternative is non-discriminatory and has less negative consequences as it is linked to the economic cycle," Lithuania's Minister of Finance Vilius Sapoka was quoted by local media as telling the parliament.

Previously, the government was proposing to tax the assets of banks, credit unions and other lenders worth over 300 million euros (333.2 million U.S. dollars).

If adopted, the new proposal would raise the current corporate tax rate for banks to 22 percent. The plan is to offer an exemption to the tax on profits below 2 million euros in order to ensure that interest rates and the prices of banking services do not increase.

An amendment to the Law on Corporate Income Tax was proposed by four members of parliament (MP) from the ruling Farmers and Greens Union and one MP from the coalition partner Lithuanian Social Democratic Labour Party.

The previous proposal to tax the assets of banks was criticized by the parliamentary opposition and the Association of Lithuanian Banks. (1 euro = 1.11 U.S. dollar)