News2020.03.10 17:19

Lithuanian president calls for more redistributive taxes

Paulius Viluckas, BNS 2020.03.10 17:19

Lithuania should raise government spending to more closely align with other EU members and be able to better fund public needs, President Gitanas Nausėda says, pledging to significantly raise GDP redistribution during his term.

The president's plans call for gradually increasing the share of tax revenue-to-GDP to 35 percent, Nausėda said in an interview with the radio Žinių Radijas.

“We set the goal of raising the level of redistribution to 35 percent within my term of office, which would be a great achievement under the circumstances and will allow us to better fund a number of areas of public life,” the president said.

“We intend to implement this gradually. You cannot do that in leaps and bounds. The first year shows that the level of redistribution will break away from the long-standing 30 percent in 2020 and will be close to 32 percent. If we continue at this pace, then I believe 35 percent is a realistic target,” he said.

The president, who built his election campaign on a promise to build a welfare state, acknowledged that it would not be easy to implement tax changes.

According to figures released by the EU statistics office Eurostat last October, Lithuania ranked 25 among the bloc's 28 member states in terms of the the tax revenue-to-GDP ratio.

In 2018, Lithuania redistributed 30.5 percent of its GDP via the government budget, well below the EU average of 40.3 percent.

LRT has been certified according to the Journalism Trust Initiative Programme