Lithuania’s Defence Ministry will use 243 million euros raised from the so-called solidarity tax on banks to fund military infrastructure projects.
Banks in Lithuania are forecasted to post over a billion euros in combined profits this year following the increased EU interest rates. Due to the rising profits, Lithuania’s government introduced the windfall tax, which it calls a “solidarity contribution”, to help fund the country's military following Russia’s full-scale invasion of Ukraine.
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"The additional funding will [...] significantly accelerate the process of putting in place all necessary infrastructure," Deputy Defence Minister Renius Pleskys said in a press release.
The temporary tax, in place since May 16, is expected to raise a total of 380 million euros for military infrastructure and military mobility projects. Most of the money will go toward the development of the Rūdninkai military training area.
The Transport Ministry will allocate the remaining funds to various dual-purpose military mobility projects.
The tax amounts to 60 percent of the net interest income that exceeds the average of four financial years by more than 50 percent.
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Commercial banks operating in Lithuania have until August 31 to make the first payment. However, Eivilė Čipkutė, president of the Lithuanian Banking Association, previously said the procedure for calculating and paying the levy was still unclear.
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