By delaying tax reform, the Lithuanian government is failing to keep its promises to its voters and its commitments to international institutions, says Irena Segalovičienė, adviser to the president.
“The issue of tax reform is actually asleep now, there was a promise three weeks ago to finalise it [the legislative package] in the government and bring it to the parliament – but we are late again,” Segalovičienė told the radio Žinių Radijas on Tuesday.
She said that dragging feet with the reform is a violation of the promise made to the voters and of the commitments to the European Commission and the whole international community.
“This is not good, because I want to remind you that the tax reform is not only a promise to the voters [...] but also the government itself has made a commitment to the European Commission and to the whole international community that not only will it submit, but also that some of the provisions related to commitments, the reduction of benefits and the changes to the personal income tax will come into force in principle during their term of office,” Segalovičienė said.
The Finance Ministry presented the legislative package tweaking Lithuania’s tax system earlier this year. The proposals include, among other things, scrapping some income tax exemptions for the self-employed and introducing a property tax.
Further reading
Finance Minister Gintarė Skaistė recently warned that if Lithuania fails to move ahead with the reform, the EC may withhold some of the funds from the Recovery and Resilience Facility.
Further reading
The government had planned to present the tax reform package to the parliament, Seimas, on May 18, but the date was pushed back due to delays in coordination with coalition partners.
The Liberal Movement group in the Seimas has said that the conservatives are not following the coalition agreement, which did not envisage the reform, when drafting the tax changes, and that the coalition has not yet agreed on the extent of the public sector commitments. Members of the Freedom Party, also in the the ruling coalition, have also criticised the reform.
Prime Minister Ingrida Šimonytė has said that the reform package should be considered and passed in its entirety or not at all.
